Happy Mother’s Day!
We wish all of you a very Happy and Blessed Mother’s Day.
Update on Rick:
Some of you already know but many of you might not know that Rick become ill on Tuesday, April 25th and on Wednesday, April 26th was sent to the emergency room at Integris Health in Edmond. He underwent a major surgery on that Thursday due to an aggressive infection. The surgery went well, and he spent a week in the hospital and was released to go home on Wednesday evening, May 3rd. He has been recovering at home and all is progressing positively. It is expected that he will be working from home this coming week and hopefully can get back to the office again the week of May 22nd. We will keep you posted as to his progress. Chris and Sam have been running the day-to-day operations at the office and are there to handle anything you might need.
The Markets:
The U.S. stock markets have maintained positive year-to-date results, with small gains for the first two weeks of May. As of last Friday’s close, the Dow Jones Industrial Average is now up 5.74% year-to-date. The Standard & Poor’s 500 stock index is now 6.79% higher than at the beginning of 2017 through May 12th. (MarketWatch)
Interest rates are still slightly lower than at the first of this year, with the yield for the 10 year U.S. Treasury now at 2.33% compared to 2.45% at the end of 2016. (U.S. Treasury) The national average rate for a 30-year fixed mortgage is now at 3.93%, and 3.13% for a 15-year fixed. (Bankrate.com)
Political Uncertainty vs Economic Uncertainty
Last week’s fireworks did not occur in the financial markets. It happened in the political arena when President Donald Trump unexpectedly fired FBI Director James Comey, setting off a political firestorm.
From an investment viewpoint, there were fears Tuesday evening that Trump’s decision would roil markets on Wednesday. While the politicos and the press salivated, investors reacted with one big YAWN.
How the market digests any new revelations in the days and weeks ahead is purely speculative. No one can accurately and consistently predict short-term market gyrations. For now, the market sees this as a political event, not an economic event.
In that vein, it is somewhat like Syria, North Korea, and the just-concluded French election. Or, the March failure by the House to pass health care reform and its subsequent success in May. These events did little to rattle or help stocks.
It’s not that what happens outside the world of Wall Street isn’t important. It is. However, purely viewed through the narrow lens of the Street, they haven’t had an impact.
But, there are questions that naturally arise from last week’s political drama. What about tax and health care reform? Will a much-coveted cut in the corporate tax rate fall victim to political infighting and stymie the rally?
While stocks soared last November amid expectations of business-friendly tax reform, more recently, a strong first quarter earnings season (Thomson Reuters), upbeat forecasts, and stronger global growth have picked up the slack. Short term, we can get volatility. Longer term, stocks have historically taken their marching orders from the economic fundamentals and corporate profits.
We appreciate the privilege to be of service to all of you and look forward to working with you in the years to come. As always, don’t hesitate to call at any time if you have any questions or if we can be of further service at any time.
God Bless,
Your TEAM at F.I.G. Financial Advisory Services, Inc.
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1 The Dow Jones Industrials Average is an unmanaged index of 30 major companies which cannot be invested into directly. Past performance does not guarantee future results.
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Uncertainty and Volatility