It's time for the Monthly Market Update! Tune in to hear what's happening in the markets and how it may affect you, featuring Leisl L. Cording, CFP®, CDFA®.
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Welcome to the monthly market update on you and your money. Empowered you reach your goals with tips and insights to help you plan well, invest well and live well. This month's market update comes from Liesl Cording, senior vice president and financial advisor at Weiss, Allens and Hanscom Strategic Wealth Advisors. Let's dig into today's topic. Liesl, give me some news from the financial markets. Absolutely. Sure. So overall, I'll talk about the economy a bit first. But overall, the fundamentals of the economy, Wayne, are showing signs of resiliency despite some of the headlines that we're seeing. But consumers are feeling pretty confident. We've got higher wages. We have low unemployment. Business spending is still relatively strong and the economy is growing a bit faster than we had anticipated. So all of that sort of leads into some of the biggest risks we see, though, in the economy, which are inflation. We're trying to still combat that. It's gotten better over the last couple of months. It's headed in the right direction. But if that spikes again, with all of the consumers feeling pretty good and businesses still spending, that could force the Federal Reserve to keep hiking rates. So that could have an impact. And then we also have still a war in Europe and some other conflicts abroad. So all of that in terms of the markets, when we look at June last month, it was a very strong month and on a year to date basis, U.S. markets have been very strong. Fixed income was a bit weaker because of interest rates. But on a year to day basis, S&P up almost 17%. The Dow is up about 5%, Nasdaq up about 32 and bonds between two and 5%. And then internationally, we're seeing markets about 12%. So lagging U.S. markets a bit. But what does this mean really for investors, Wayne? We always go back to this every time we talk about the markets. But we're keeping a close eye on the risks and we're not done with the volatility that we're seeing and likely will continue to see a rebound with some ups and downs. But always remember to stay focused on those longer term goals and don't let this short term volatility. I mean, we've seen quite a run since the bottom of the market at the end of or during the fall last year. So always focus on the longer term goals. That's really important. Laszlo, what's the relationship between inflation and the rising market? Does inflation trigger the market to go higher? Or does a rising market trigger inflation? Well, that's a good question, Wayne. Inflation is really driven by the prices of things in the books and markets and just in general, in everyday living. And so that can have a have an impact on the overall increase in revenues and businesses and things like that. So it does have an impact on it for sure. But now we're seeing that we have to combat that because if we have inflation running too hot for or too high and too hot for too long, that's going to have an overheating economy which will have inflation higher for longer. And we really want to see inflation on a 2 to 3% increase on a year over year basis, whereas we were up toward 9%. So that's pretty significant. From your catbird seat, do you anticipate the Fed having another rate increase soon or are they going to kind of keep it this way for a while? Likely we'll see another increase at some point. I think investors were I mean, we were happy with the pause that happened in May. And as we sort of move through and we're really seeing, like I had mentioned, a resilient economy that's going to have the Fed really sort of question whether they should raise rates or should we continue to pause? Likely, we'll probably see some some rate increases. It all depend on the inflation numbers, really. And if those continue to go down for, we might see them continue to pause, but likely we'll see some more before we start seeing interest rates come down. And we were hoping that we'd see rates decline by the end of the year. I don't think that's going to happen. That's it for today. As always, thanks for listening to you and your money. Find even more episodes, videos and other resources at our website. W. H. Z. Well. Dot com. Be sure to come back next week for more tips to help you live fearless and pursue your financial and life goals. Until then, live well. In the enhanced strategic Wealth, advisors offer securities and advisory services through Commonwealth Financial Network member FINRA, SIPC, a registered investment advisor, Fixed insurance products and services offered through CSC Insurance Agency. They practice at 697 Pomfret Street, Pomfret Center, Connecticut 06259 and can be reached at 8609282341. 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