Statistic of the Week:
The nation’s roads are becoming more dangerous. For decades, deaths on America’s roads have been declining. However, over the past two years, that figure has reversed – spiking 14.4%. While the actual cause is debated, many experts are pointing to distracted driving, specifically smart phone use.
It’s not just Americans that are packing on the extra pounds. The number of obese children globally has increased by 10x over the past 40 years. The World Health Organization stated that in the mid 70’s, less than 1% of children 5-19 were obese, today that figure stands at 7%. (20% are overweight). The number of obese children will surpass malnourished children by 2022.
Market Moving Events:
Tuesday: PMI Index Wednesday: Durable Goods Orders, New Home Sales, Petroleum Status Report Thursday: Jobless Claims, International Trade, Pending Home Sales Friday: GDP, Consumer Sentiment
Equity markets in the US were once again firmly in the black last week, with the DJIA and the S&P rising nicely. The DJIA put in a remarkable move, up 2.04%1 (exaggerated largely because of its antiquated methodology). In a more measured fashion, the S&P 500 ticked up 0.88%2 and the NASDAQ rallied 0.36%.3 International stocks did not have the same momentum we experienced in the US. Developed international stocks fell about -0.31%4 and emerging markets retreated -0.54%.5 The strength in domestic equities did have a negative impact in the fixed income markets. The yield on 10-year Treasuries increased about one-tenth of one percent to 2.39%.6 We have noted several times that the market is looking for tax reform to help legitimize stellar gains since the 2016 election. Treasury Secretary Mnuchin hinted last week that if Congress did not pass a tax reform bill, equity markets would feel the consequences.7 Many have asked us what the tax bill will look like, and the truth is – we are not sure. Our best guess is that it will look more like a tax cut than tax reform (don’t count on “revenue neutral”), and that it will likely benefit corporations the most (which would not be a bad thing for the investment markets). The President tweeted this morning that the deduction for 401(k) contributions will stay in place.8 Rumors still persist around losing deductions for state and local taxes. Needless to say, this will likely be the key topic investors monitor as 2017 begins to wrap up. - Dan McElwee, CFP®
Chart of the Week: