With the close of the first quarter, we have seen the markets continue to react to the election of Donald Trump to the U.S. Presidency. We saw the Dow hit and remain near 20,000, the Fed raise rates, and Great Britain take its first steps toward exiting the European Union.
The S&P 500 ended the quarter up 5.53%, as the domestic markets continue to rise based on potential fiscal policy and economic growth. The market’s reaction to the March jobs report, which noted slower job growth than expected, was muted, possibly due to the unemployment rate falling to a 10-year low of 4.5%. We expect the Fed to raise rates at least one more time, possibly two, before year’s end.
The Commerce Department reported last week that the national deficit fell nearly 10%, to $43.6 billion. Many analysts point to the record drop in Chinese imports, rooted in President Trump’s encouragement to buy American goods, for this sharp decline.
Market analysts do caution that a pullback seems likely in the United States especially once Wall Street and its investors stop riding the highs that came with Trump’s election and the hopes of his boosting the economy. However, they remain optimistic about Europe where current elections are causing governments to make investments where they otherwise may not have.
President Trump’s first months in the executive branch have been seeping with rhetoric, promises, accusations, and an upheaval of the political climate as we’ve come to know it. The failure to repeal and replace Obamacare has many wondering what the future holds for the Trump administration, and his reversal of many Obama-era policies is causing confusion and worry among Democrats and Republicans alike.
As we’ve noted before, there’s a large difference between rhetoric and reality. While the market movement has largely been positive since President Trump’s election, we believe volatility may be in the near future. As such, we are consistently positioning your portfolios to mitigate risk as much as we can. We know that the future is uncertain and the political and economic climates are wearing, but we hope you know that we’re in your corner and are doing everything we can to help position you for success.
If you have any questions or concerns, please feel free to reach out to our team.
Investors cannot invest directly in indexes. The performance of any index is not indicative of the performance of any investment and does not take into account the effects of inflation and the fees and expenses associated with investing.