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We have had this week circled on our calendars for a long time. This is a big market week with a lot of things going on that could impact your investments.
Washington DC
The Debt Ceiling continues to be an issue in Washington DC. The deadline is November 3rd and as always, politicians are letting it come down to the last minute. Also, the Speaker of the House vote is coming up.
Along with all the moving parts in Washington, the Fed is meeting this Wednesday. We still do not expect them to raise interest rates now or in December.
What could impact market growth this week?
The GDP report comes out this Thursday. Second quarter GDP was 3.9%. Some economists are saying that it will come back to 1.7% so we will be watching how this impacts market growth this week. There are also a lot of earnings reports coming out this week. We are especially watching the big oil companies to see how they are doing which can tell us much about the economy.
Positive market growth last week
What drove the positive market growth last week wasn’t earnings, but the international central banks. The ECB came out to say they might be extending their asset purchase program, and that shot our markets up. Then the Central Bank of China cut their interest rates, also having a positive impact on our markets. We see this as an artificial market growth as it is not coming from our economy, but from international central banks. This is a case of international bad news translating into good news for our markets. This leads to the markets being more disjointed which impacts investors’ portfolios.
Keeping an eye to China’s Communist Party meeting
When China cut their interest rates on Friday, it marked their 6th time this year to do so. They also reduced the amount of bank reserve requirements in an effort to help stimulate their economy. What we are very focused on is the Chinese Communist Party which will be meeting over the next four days. These meetings have a tendency to be historically significant. They will most likely be trying to figure out where the floor is on this drop in their markets and economy. These are closed door meetings but we will find out more about it in March. China impacts a 3rd of the world’s economy so we are watching this closely.
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Ashley Page, JD, MBA
Senior Vice President
Wealth Consultant
Email Ashley Page here
Bobby Norman, CFP®
Vice President
Wealth Consultant
Email Bobby Norman here
Trey Booth, CFA®
Vice President
Wealth Consultant
Email Trey Booth here
Fi Plan Partners is an independent investment firm in Birmingham, AL, serving clients across the nation through financial planning, wealth management and business consulting. Fi Plan Partners creates strategies in the best interest of their clients using both fee based investing and transactional investing.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.
Economic forecasts set forth in this presentation may not develop as predicted.
Stock investing involves risk including potential loss of principal.
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