Market Update – May 28, 2019
The Week on Wall Street
Stocks drifted lower last week as investors considered the possibility that the world’s two largest economies might take some time to resolve key trade issues.
The S&P 500 retreated 1.17%; the Nasdaq Composite, 2.29%; the Dow Jones Industrial Average, 0.69%. The concern over trade was felt elsewhere: the overseas developed markets benchmark, the MSCI EAFE, also lost 1.41% in five sessions.[i],[ii]
Market Waits for Further Trade Talk Cues
A compromise on tariffs between the U.S. and China did not seem forthcoming last week. Negotiations appeared stalled. Regardless, President Trump and Chinese President Xi are slated to meet at June’s G20 summit in Japan.
The Department of Commerce has effectively banned U.S. companies from doing business with Chinese tech giant Huawei, a major global player in 5G technology. Some analysts think China may respond with retaliatory measures.[iii]
Leading Retailers Report Earnings
Big-box stores and other major retail chains announced first-quarter results last week. While some traditional department store chains disappointed (Kohl’s, JC Penney, Nordstrom), Macy’s recorded its sixth straight quarter of comparable sales growth. Target reported a 10.8% jump in earnings in the first quarter, Walmart announced Q1 gains in earnings and revenue, and Urban Outfitters saw record sales in Q1.[iv],[v]
Any companies mentioned are for informational purposes only, and this should not be considered a solicitation for the purchase or sale of their securities. Any investment should be consistent with your objectives, time frame, and risk tolerance.
Final Thought
As new chapters in the U.S.-China trade drama continue to unfold, remember that your investment approach is built around your long-term objectives and risk tolerance. There will always be day-to-day price changes; there will always be breaking news alerts. The disciplined, long-term investor stays the course through the ups and downs.
THE WEEK AHEAD: KEY ECONOMIC DATA
Tuesday: The Conference Board’s latest monthly consumer confidence index.
Friday: May consumer spending numbers and May’s final University of Michigan consumer sentiment index (another important measure of consumer confidence levels).
RCM Investments is a branch office of DFPG Investments, Inc. Securities offered through DFPG Investments, Inc., member FINRA/SIPC. Investment Advisory Services offered through RCM Investments, a SEC-Registered Investment Advisor. DFPG and RCM Investments are not affiliated.
Past performance of investments is no indication of future results.
[i] https://www.wsj.com/market-data
[ii] https://quotes.wsj.com/index/XX/990300/historical-prices
[iii] https://www.cnbc.com/2019/05/21/tech-stocks-are-feeling-the-pain-but-may-emerge-better-off-after-trade-war.html
[iv] https://seekingalpha.com/article/4265991-q1-2019-u-s-retail-scorecard-may-21-update
[v] https://www.just-style.com/news/us-q1-in-brief-ross-stores-l-brands-target-corp_id135965.aspx