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.
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.