Financial Planning Services in Houston, Texas

March 9, 2019, marked the 10th anniversary of the current bull market, the longest-running in U.S. history. In that decade, the market more than quadrupled, and when you factor in dividends, it’s up fivefold.
The short-term spikes over the past few years coupled with corporate share buybacks have served to keep performance humming. As we move forward, a few points of note:
  • The Federal Reserve has recently exercised more patience when it comes to raising rates, which has helped stabilize long-term yields in the bond market.
  • Some market analysts say 2019 will feature slower earnings growth, as evidenced by the first quarter drop in earnings estimates.
  • While there’s little talk of a recession starting this year, overall growth prospects are expected to diminish.
  • While growth stocks have been outperforming value stocks, those positions could reverse as growth subdues.
According to Citi Research, the U.S. stock market has been driven by share buybacks more than by new investor money over the past year. In 2018, corporate share buybacks reached a new record at more than $800 billion, and that trend was expected to continue through this year — fuelled by money repatriated from overseas. At the same time, after last December’s stock market slump — the worst in 87 years — the market also saw significant outflows.
With that said, whether you should invest more money in the market or transition to a more conservative allocation depends entirely on your own financial needs and circumstances. It’s a good idea to check in with your financial advisor periodically to weigh your current portfolio positions against your stated goals and timeline. Feel free to contact for a portfolio consultation or a second opinion.
Credit Suisse’s forecast is bullish for the rest of 2019, positing up to a 20 percent gain on the year and earnings growth rate of 4.4 percent. The wealth manager says it sees the Fed’s more moderated stance, diminished fears of higher inflation and the potential for a favorable trade agreement with China as driving forces for lower volatility and the potential for higher stock market performance.
According to LPL Financial Research, historical performance in relation to election years can provide some context for stock market forecasts. For example:
Goldman Sachs is a bit more bearish about the rest of the year. Analysts there expect weak profit growth across all sectors with relatively low returns and a narrow trading range. Peter Oppenheimer, chief global equity strategist at Goldman Sachs, points to ongoing trade disputes with China, Brexit uncertainty and general global concerns
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Read more at Bull Market Turns 10 - Lake Point Advisory Group
Location: Houston, TX, USA

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