Markets edged higher this past week without much enthusiasm. Traders focused on news out of the White House, specifically the on-and-off talks with North Korean president Kim Jong-un and ongoing spats with China over trade issues. One bright spot, however, was the Russell 2000 Small Cap Index, which scored a new record high earlier in the week, before settling back. As indicated in earlier updates, small businesses are likely to benefit more from tax reform and deregulation than large cap stocks. The Dow Industrials did manage a slight uptick for the week with a gain of 0.15% and the S&P 500 was better by twice that. The NASDAQ gained 1.1% thanks in part to a strong technology sector. But utilities were the star performer moving ahead by over 3%. Oil moved lower by $3.40/bbl. as OPEC appears to be signaling more production output. The news sent energy stocks negative by 4.6%.
Although gold was higher on the week, once again breaking the $1,300/oz. mark, the yellow-metal has been lackluster of late. The strong dollar, rising interest rates and even interest in cryptocurrencies as an alternative have hurt gold. Keeping an eye on the volatility index – or VIX – suggests that recent lulls may only be temporary, and another spike may be on the horizon. Equities, however, are likely to be further supported by a growing economy, lower taxes, fewer regulations and positive earnings comparisons. Conversely, markets may continue to face periodic headwinds relating to geopolitics, trade, inflation, the Federal Reserve and rising bond yields. Hence, the push and pull on stocks will likely net out to flat results for a while with sharp spurts of ups and downs along the way.
Markets will be closed tomorrow for observance of Memorial Day. In the meantime, enjoy the rest of the holiday weekend.
Here is the answer to last week’s trivia question: Forbes Magazine, one of the nation’s leading businesses and financial publications, was founded by B.C. Forbes in what year? 1917, 1926, 1944 or 1952. Answer: 1917
Today’s Trivia Question: Which of the following companies is NOT using the NASDAQ as their primary trading platform? CSX Corp., Automatic Data Processing, Inc., International Game Technology or PepsiCo.