|Weekly and Year-To-Date Performance|
|INDEX||12/31/2017||11/30/2018||12/07/2018||% Change Week||% Change YTD|
|Dow Jones Industrial Average||24,719.22||25,538.46||24,388.95||-4.50%||-1.34%|
|Russell Mid-Cap Index||2,081.59||2,067.21||1,975.92||-4.42%||-5.08%|
|Russell Small-Cap Index||1,539.15||1,534.12||1,448.09||-5.61%||-5.92%|
December 7th, 2018
Dear Friends –
The equity markets finished out another volatile week of trading with losses across the board. The declines to close out the week erased the S&P 500’s gains from a week ago as the index closed within one point of its close on November 23rd. The Dow and the Nasdaq are up slightly over the past two weeks. For the week the Dow Jones Industrials, S&P 500 and the Nasdaq fell 4.5%, 4.6% and 4.84% respectively. The Russell Mid-Cap, Small-Cap and MSCI EAFE indexes were off 4.42%, 5.61% and 3.22% respectively.
Stocks moved higher Monday to continue the run of gains on optimism over trade talks with China. The weekend’s G-20 meeting ended on a high note with China and the U.S. agreeing to a 90-day cease fire to the ongoing trade war. The two nations are still working on terms but the progress was widely viewed as a positive and the markets responded in kind. The Dow shot higher at the open gaining over 400 points as shares of trade sensitive stocks like Boeing and Caterpillar gained 3.8% and 2.4%. Energy prices also climbed as oil prices gained over 4% to close at $53.08 per barrel. The energy sector led the S&P gaining 2.28%, with consumer discretionary and technology also gaining 2.21% and 2.11%. The Dow closed up 288 points or 1.13%, to settle at 25,826. The S&P and the Nasdaq added 1.1% and 1.51%. The benchmark 10-year Treasury note fell nearly five basis points to close yielding 2.966%.
The markets reversed course Tuesday and fell across the board in a steep selloff. Concerns over trade, the pace of economic growth and yield spreads all contributed to the downturn. Trade worries returned as the progress on talks with China fell into some doubt following some mixed messages out of the White House. The fears of a slowing economy were amplified when the 2-year Treasury note and 5-year note inverted, with the 2-year yielding more than the 5-year, albeit only slightly. The spread between the 2-year and 10-year notes remains positive, but the spread continues to narrow. The break in trading this week, as the markets will be closed Wednesday for the State Funeral of President Bush, also contributed to big rise in trading volume. Financials led the declines followed by industrials and consumer discretionary which fell 4.4%, 4.35% and 3.91%. The Dow closed down 793 points or 3.07%, to settle at 25,033. The S&P and the Nasdaq fell 3.24% and 3.8%. Crude prices edged higher again gaining 30 cents per barrel.
Stocks finished out a wild trading session Thursday with mixed results. The Dow opened with sharp losses as worries over trade and economic growth sent the index lower by nearly 800 points before mounting a huge reversal that nearly erased all of the losses. The technology sector led the Nasdaq back into positive territory as shares of Netflix, Amazon, Alphabet and Intel gained 2.74%, 1.85%, 1.7% and 1.3%. Consumer discretionary stocks also made gains with the sector adding 0.61% as shares of Costco, Lowe’s and Home Depot 3.03%, 0.69% and 0.68%. The Dow closed down 79 points or 0.32%, at 24,948. The S&P was off 0.15% and the Nasdaq closed up 0.42%. The benchmark 10-year Treasury note settled down three basis points yielding 2.892%. Crude prices fell 2.23% to close at $51.71 per barrel.
The markets moved lower Friday in another volatile trading session. The major indexes opened with slight gains only to move into negative territory shortly after and drift lower throughout the session. The moves erased the gains made by the headline indexes last week down to within one point in the case of the S&P 500. The traditionally defensive utilities sector was the lone S&P sector to finish with a gain. Technology and consumer discretionary led on the downside with losses of 3.53% and 3.08%. In economic news the economy added 155,00 jobs in November, short of the consensus estimates that called for a gain of 198,000. Wage growth also came in below estimates but remained above the 3% mark on an annualized basis. The Dow closed with a loss of 559 points or 2.24%, to settle at 24,389. The S&P and the Nasdaq were off 2.33% and 3.05%. Crude prices closed up nearly 2% to settle at $52.46 per barrel after news that OPEC and their related but non-member nations came to an agreement to cut output in the first half of 2019. The benchmark 10-year Treasury note fell two basis points to close yielding 2.856%.