May 2017 Market Insight
Volatility in the market is at a multi-decade low. Even though the markets are buzzing with noise about political drama (U.S. House of Representatives passing the Obamacare replacement, Trump & Comey), geopolitical drama (Brazil, North Korea, Italian election, terrorist attack in England) and earnings (soft retail earnings), the general outlook for the market remains largely unchanged.
On May 17, as anxiety grew with investors, stocks had their worst day since September with the S&P dropping 1.82%. However, stocks rallied in response to positive economic and political data, with the S&P hitting all-time highs, breaking through 2400. The resilience of global markets was also evident as the MSCI World Index moved to a new all-time high.
Bonds have quietly advanced this year. The Federal Reserve’s May meeting minutes indicate another rate hike, possibly in June.
A little closer to home, as people are getting more comfortable borrowing, the U.S. household debt reached a new record earlier this year. Total debt is now exceeding its 2008 peak, a total of $12.725 trillion, according to The Wall Street Journal.
We continue to watch interest rates, the growing U.S. & global economy, and other geopolitical surprises (terrorist attacks, military conflicts, politics and elections, etc.) and their impact on the markets.
If you have questions or would like to discuss your investment specifics, please contact us.
|S&P 500 Composite||1.41%||8.66%|
|MSCI World Ex-US||3.33%||12.72%|
|Barclays US Aggregate Bond||0.77%||2.38%|