Volatility has reappeared, but don’t lose focus.
The third quarter ended strong but recently, the equity markets have experienced some notable fluctuations – a sharp contrast from the steady upward climb we saw in 2017. Concerns about rising U.S. interest rates, trade disputes and the technology sector contributed to declines for all three major U.S. stock indices
Concern over trade policy, especially the prospect of a prolonged fight between the United States and China, likely affected domestic stocks. Many experts agree the outlook for the economy remains positive, though volatility is likely here to stay for a while. “The near-term prospects for the economy remain strong, but there are concerns about the November election, trade policy disruptions, tighter Federal Reserve policy, a stronger dollar, risks to global growth, and labor market constraints,” economist Scott Brown said. “Expect increased volatility and see-sawing markets in the near term.”
That said, when the markets experience volatility, it’s natural to feel some apprehension or uncertainty about your portfolio. This is why we spent time developing your tailored financial plan – to account for these fluctuations while remaining focused on your long-term financial goals. While no one can say exactly what will happen in the coming months, we are closely monitoring these market movements and the driving factors behind them. Often times, declines such as the ones occurring now are opportunities.
We will be in touch with any updates or appropriate recommendations should conditions change.
Please let us know if you have any questions about the recent market activity or your long-term financial plan. As always, we remain committed to supporting your financial future and are grateful for your continued trust.
Recent data suggest that the economic expansion continued at a moderately strong pace in 3Q18, with moderate inflation. Trade tariffs have had a significant impact on some sectors, but only a modest impact on overall economic growth and inflation. However, the risks will increase as trade conflicts escalate. Fiscal stimulus (deficit spending) should continue to provide support into early 2019. Federal Reserve officials believe that policy is close to normal, but many believe that rates may need to become restrictive in 2019 or 2020.
Raymond James. “Economic Snapshot.” Investment Strategy Quarterly. Pg. 4, Web.
Raymond James, “Investment Strategy Quarterly Recap.” Investment Strategy Quarterly. Pg. 4, Web.
Investing involves risk, and investors may incur a profit or a loss. Past performance is not an indication of future results. There is no assurance that any forecast mentioned will occur. Expressions of opinion are as of this date, subject to change without notice and are not guaranteed to occur. Some material in this newsletter prepared by Raymond James for use its financial advisors. This information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. All opinions are those of the author and not necessarily Raymond James.