Friends
After a terrible 4th quarter of 2018 where we saw that worst December for stocks since the 1930’s, market participants were the recipient of a stellar 1st quarter of 2019. After the Dow had tumbled nearly 10 % just in December, highlighted by a 2.35% drop on Christmas Eve alone, we saw the new year begin with a more than 2% drop on January 3rd. Needless to say the psyche of investors was challenged at that point. But, from that moment on stocks began to recover and over the next three months we erased Decembers losses. We haven’t yet made it to new highs but at least some of the bad taste left in the mouths of investors from Q4 2108 has been washed away.
On this final trading day of the quarter, the Dow Jones Industrial Average was up 211 points to close at 25,928. The S&P 500 was up 18 points to finish the day at 2,834. Gold was up $1 to trade at $1,296 per ounce, while oil was up $.91 to trade at $60.21 per barrel WTI.
It was a great 1st quarter for both stocks and bonds, but as we look into the 2nd quarter of the year we face some challenges. The yield curve has inverted and economic slowdown appears to be at hand. We will be entering an interesting earnings season over the next 30 days, one that comes with lowered expectations and much angst. The Fed is firmly in the dovish camp now, but that comes with concerns of its own with regards to the Fed’s views about the economy going forward. But, as we have seen in recent years TINA might come back in play, where stocks are the only game in town. For now, let’s enjoy the quarter that is now in the books and be ready to get back at it next week.
Have a great weekend everyone.
