Stocks climbed to yet another record on Wednesday, marking the 31st new all-time high reached by the S&P 500 this calendar year. Gains were muted as investors weighed positive economic news against rising geopolitical tensions between Ukraine and Russia. Moreover, volume slowed to a trickle as many market participants are away on holiday. Six of the ten sectors of the S&P showed gains, with utilities gaining most (0.96%) and financials underperforming (-0.1%). Commodities were mostly higher and Treasuries sold off slightly.
It doesn’t appear that markets will be setting another high today, as news report of another Russian incursion into Ukraine surface. European and Asian bourses lost about 1% overnight, and U.S. equity futures are pointing to a lower open by about ½%. We expect continued light trading volume of the next two weeks, as market participants enjoy the last weeks of summer (unofficially of course). Our base line continues to be ongoing geopolitical turmoil, and moderate economic growth worldwide, coupled with a more rapidly improving labor market and overall economic conditions in the United States. Based on this, we expect that U.S. stocks should continue to shine over the next 12 to 18 months. From a technical perspective, the recent market rallies setting new highs are encouraging and a healthy sign. While some investors may worry that stock prices are overdue for a more meaningful correction, the current sentiment and technical patterns are supportive of a continued rally.
Make sure to tune into CNBC on Friday at 3:45 PM when our President, Oliver Pursche, joins Kelly Evans on the floor of the New York Stock Exchange to discuss our latest market and economic outlook. And don’t miss a great Money Matters with Gary Goldberg this week, when Gary highlights interviews with Nobel Laureate Dr. Robert Merton, former Labor Secretary Elaine Chow, and basketball legend John Calipari. Money Matters with Gary Goldberg airs every Saturday at 2:00 PM and Sunday at 11:00 AM on WOR 710 AM radio – visit our website www.ggfs.com for details.