The Money Wise Guys kick off this Labor Day weekend edition with a mixed week on Wall Street. The Dow Jones Industrial Average fell about 147 points, or 0.3%, while the S&P 500 gained about seven points, or 0.1%, and the Nasdaq rose about 105 points, or 0.4%. Year to date, the Dow is up 11.1%, the S&P 500 is up 12.8%, and the Nasdaq is up 14%. With lighter trading volume continuing through August, the team discusses a market that has largely been moving sideways as investors wait for fresh inflation data and the Federal Reserve’s next interest-rate decision. They also examine a surprisingly strong August jobs report and the unusual dynamic of positive economic news being treated as bad news because of what it could mean for rates. Rather than getting caught up in every Fed comment or market reaction, the team argues that investors should keep the bigger picture in mind, including employment, economic growth, corporate earnings, and historical context around today’s interest-rate environment.
Midterm Elections
The conversation then turns to the approaching midterm elections and the importance of not allowing politics or emotionally charged headlines to drive an investment strategy. Election cycles can create added uncertainty as investors consider how potential changes in policy or leadership could affect the economy and markets. However, the team points to historical data showing that markets have generally performed well in the 12 months following midterm elections, regardless of which party gained or maintained control. While past performance doesn’t predict future results, it’s a reminder to keep election-year emotions in perspective and stay focused on economic fundamentals and a long-term investment strategy.
In the second hour, the Money Wise guys delve further into their discussion on Equity Index Annuities. You don’t want to miss the details! Tune in for the full discussion on your favorite podcast provider or at davidsoncap.com, where you can also learn more about the Money Wise guys or take advantage of a portfolio review and analysis with Davidson Capital Management.
