A year ago I wrote a newsletter with this very same title “Full Steam Ahead.” At that time, the Dow had fallen to around 16,400 before reversing course as stocks had staged an impressive rebound from their 2016 February lows.
Fast track to 2017, where equities have continued their positive trend as the Dow recorded 12 new record highs and posted a monthly gain of 4.77% - its best month since November. The S&P and Nasdaq markets also joined the party with returns in excess of 3.5% for the month. Since the presidential election, investors have continued to pour money into stocks. Likely in anticipation of tax cuts and policies intended to boost corporate earnings.
So are the markets going straight up from here? I don’t think so. Over my years as an investment advisor I have noticed that markets will sometimes move in a similar fashion to a sprinter. You take off, running as fast as you can, and you then pause to catch your breath before attempting to run again. After an advance, I think we will be pausing to catch our breath for a bit before attempting another run.
Dow 36,000? Brian Westbury from First Trust reflects back Jim Glassman’s book. Click her to watch the latest Wesbury 101
Got millionaire envy? This chart can help When you break a big process like wealth accumulation into smaller variables, you can start to see realistic paths forward’
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The Dow Jones Industrial Average is an unmanaged index of 30 widely held securities. The S&P 500 is an unmanaged index of 500 widely held stocks. The NASDAQ Composite Index is an unmanaged index of all stocks traded on the NASDAQ over-the-counter market. It is not possible to invest in an index. The Consumer Price Index (CPI) is a measure of the average change in consumer prices over time of goods and services purchased by household; it is determined monthly by the U.S. Bureau of Labor Statistics.
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