Watch David’s latest market update!
Hi, this is David Reyes from Reyes Financial Architecture.
I felt it was a good time to do a market update. I haven’t done one in a while, the reason being the market has gone pretty much straight up since January. We are up about 14%, we were in the Dow Jones Industrial.
What has happened over the last three weeks is, you know pretty startling but actually normal. The Dow is down 1332 points in three weeks since April 23rd, which is a 5% move, which is pretty significant. Although, last year we had two 10% corrections and a 20% decline, so the market is back to being very volatile again after having the first quarter being very muted.
What is amazing also is that we have gone nowhere since January 2018. In fact, if you invested in the Dow in January through today, you’re actually down 0.6%. If you just bought little bonds, long-term Treasury bonds, you are over 5%. The reason I bring that up is because with markets like this, you have to be careful. We are basically almost approaching a year and a half going nowhere with a lot of volatility. You better have a plan to make sure you mitigate that volatility.
Also, as many of you have been listening and watching the news, China is been a big issue. We just now increased the tariffs against China, which has been a big deal. But probably the biggest pressure has been on the market as earnings. And a lot of times news can really negatively impact or hide what is really happening underneath the surface.
We peaked out in S&P earnings in the fourth quarter of 2018 and now we are down to the low single-digit. So, we already have a lot of issues; the Federal Reserve is talking about decreasing the interest rates as opposed to increasing the interest rates, so all of these things put together really mean that we are probably not in a very good footing.
If you want to reach out to me, give me a call, I would love to sit down and chat with you.
This is David Reyes.