Nick Notes for September just released!
Nick Pirsos, Wealth Advisor at MRA Advisory Group, published his updated view of equity markets. You are invited to schedule a complimentary first meeting (link below) to discuss his views in greater detail and to learn how to best optimize your portfolio to better attain your retirement goals.
Equity markets in August were a tale of two halves. They continued to rally in the early part of the month, up about 8%, extending the gains from the mid-June low for a total return of about 15%, just above the average recovery returns for bear market rallies. By August 26th, however, most equity markets gave up their promising initial gains finishing about +/- 2% for the month.
Federal Reserve Chairman Powell provided his most direct comments last week at the Jackson Hole Conference regarding the direction of interest rates for the foreseeable future, which dampened equity investor hopes that we could begin to see a moderating trend.
Notwithstanding the Chairman’s unusual clear commentary, mixed economic signals continue to show signs of weakening. Earlier this year, only one Recession risk indicator was negative versus half presently flashing a warning.
While inflation trends are showing signs of turning for the better, albeit still at high levels, recent US legislative action could damper the pace of near-term declines. Revised final 2Q22 GDP results were not as bad as initially feared but remained negative for the second straight quarter. Initial 3Q22 GDP estimates will post in September and could finally help settle the recession debate. Finally, US mid-term election polls are tightening, which could reduce the chance of a generally favorable market outcome, specifically, divided government. While the aforementioned are all directionally troubling, investors have already largely developed their views on these factors.
We expect their primary focus in September will continue to be on Fed policy expectation on interest rates inspite of the Chairman’s recent remarks. Will the Fed continue to adjust rates aggressively higher to close the gap versus current inflation trends or will the pace moderate based on their expectations of declining inflation in the months ahead? For the moment, the former view is winning and keeping investors at bay but a switch to the latter could see an increased appetite for equites beyond mere corporate buybacks which are setting records.
ACTION PLAN: Now is the time to start planning year-end 2022 tax-selling strategies and developing investment views for the new year. Unsure where to begin? Let us Help.
We can help with:
- Our forward twelve-month Equity Market Outlook.
- Strategies to mitigate monthly equity volatility.
- Identifying your portfolio’s current expected risk/opportunity level.
- Optimizing your portfolio’s performance.
- Capital gains tax positioning.
- Or any other personal Financial Planning and Retirement Savings needs including Insurance (Life, Disability, Group Health), College Planning/529 Plans, Wills and Estate Planning.
- Small Business owners, we can help you with employee retention creating low-cost 401K and Pension Plans and Group Medical Health Insurance.
Feel free to share our views with family or friends who are also confronted with these important Wealth Planning decisions. MRA Advisory Group and I are ready to discuss all your investment concerns to best position your Retirement Goals.
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Advisory Services offered through MRA Advisory Group, a Registered Investment Adviser. It is general in nature, is not a complete statement of all information necessary for making an investment decision and is not a recommendation or a solicitation to buy or sell any security. Investments and strategies mentioned may not be suitable for all investors. Past performance is no guarantee of future results. Nothing herein, nor any attachment, shall be considered to constitute (i) an offer to sell, nor a solicitation of an offer to purchase, any security or (ii) tax or legal advice.