This will be CWM’s last weekly market commentary as we are changing our communication strategy. Going forward, we will be sending a monthly market commentary, as well as a quarterly financial planning newsletter. For all of our clients that have questions or concerns about the markets, feel free to give us a call or send an email; you don’t need to wait for the monthly market commentary to have your questions answered or to know how we perceive the current investing environment. Should the market experience an extreme event, I will be sure to send you my thoughts and how I’m handling the situation in a timely manner. Now, on to the markets.
Global markets registered a fair week spurred by none other than the Federal Reserve. This past Monday Fed Chairman Ben Bernanke hinted that the accommodative policy of low interest rates is still intact until 2014, and they stand ready to print more money if need be. One of the more important economic data points, durable goods orders, missed expectations by a small amount, but the underlying point of inventories rising was the worry that dragged the markets on Wednesday. A few items I am watching closely are the S&P 500 in relation to oil and the Chinese market. If you look at the chart below you see a tight correlation between the S&P, oil and the Chinese market. But, you will note that two are falling and one is still hanging in the ether. Note that the Chinese market (in Orange) broke down in February, oil (in blue) has followed, and the S&P (in black and red) is still holding. If you have ever watched the roadrunner cartoons, you know that Wile E. Coyote can run off cliffs only so far before gravity takes hold.
Do you have an investment strategy that seeks to protect your portfolio against volatile economic conditions? Call me to schedule a free review of your current investment portfolio – 913.402.6099.
John P. Chladek, MBA, CFP® is the President of Chladek Wealth Management, LLC, a fee-only financial planning and investment management firm specializing in helping families and couples who are not yet retired realize their financial goals. For more information, visit https://www.chladekwealth.com.