Despite a rough month, the stock market is still up in 2019 August was a wild month for equities. The S&P 500 moved more than 1% in half of the month’s 22 trading sessions. There were three declines of at least 2.6% (August 5th, 14th and 23rd) during the month. The worst trading day of the year was August 5th, where we saw the market recede by -2.97%.
So far, September has started strong and the S&P 500 is up 18.85% year to date. Things could quickly change, however. The market was up 7.13% from January 1st, 2018 through September 11th, 2018. The market declined -13.19% afterwards with the S&P 500 ending the year down -6.24%.
The issues that pushed the markets down last year remain in place. Business investment has been slowing due to the difficulty in planning around ever changing economic policy. A hard Brexit and increased tariffs are still a possibility in the coming months, which would further slow growth. Worse yet is the fact that concerns about the trade war caused the August consumer-sentiment index to have its largest monthly decline in six years. The majority of Americans now fear a recession is likely within the twelve months.
I will continue to monitor and report on the market as news develops. As for your financial planning, you should remain focused on the long term. For those whose goals are many years away, a decline in the stock market means you’ll be able to buy shares at a discount. If you’re nearing retirement, the focus should remain on investments that offer safety while acting as a hedge against inflation.
As always, feel free to reach out with any questions or concerns.