Headline Volatility - October 9, 2019

The economic fundamentals have taken a backseat to headlines for much of the year, much more than has historically been the case.

Trade headlines helped drive shares higher earlier in the year.

  • The pullbacks in May and August occurred amid an escalation in tensions.
  • June/July’s rally occurred amid more positive trade headlines.
  • Economic concerns linger, but more recent action has been influenced by headlines.

A peek into Q4

There’s not much optimism this week’s trade talks will produce a deal. Yet, computer-trading programs can influence day-to-day action as they are triggered by headlines.

While the President insists a “good deal” is required for his signature, the need for a win could force him into making concessions that de-escalate short-term tensions at the expense of fundamental reforms in the U.S.-China trade relationship.

Investor’s corner

Timing the market is not a realistic option. It’s akin to ‘gambling’ whether stocks will rise or fall.

  • Timing more closely resembles a bet on next week’s big game. Take the points, put down your money… hope for the best.

An investment plan designed to capture the long-term upward bias in stocks, while managing downside risks, can help you to reach your financial goals. Or, maybe your goals are income-oriented.

If you have a comprehensive financial plan that has you on the road to your goals, you are on the narrow path. We applaud you.