November 2015 Monthly Outlook- “Tis the Season”

Now that Halloween is over we can turn our attention to the upcoming holiday season. Likewise, the next 2 months could be ‘Tis the season’ for equity markets, as November and December are historically 2 of the best months each year for equity market returns.


source: Yahoo Finance

The latter part of October saw a strong rally in equity markets, largely driven by excellent 3rd quarter earnings from the Technology sector (Google, Amazon, Facebook, and Apple) and further monetary stimulus in China and by the ECB (European Central Bank). It now appears we did have a successful double-bottom in stocks as discussed in last month’s Outlook. The recent rally and historical seasonality support equities moving higher into the end of the year.

The Economy  (source: SEI Private Trust)

  • The U.S. economy experienced modest growth in third quarter amid a robust job market; yet rising prices weighed on home sales. Overseas, the U.K. economy expanded despite volatile construction and sluggish manufacturing, while Eurozone employment notably improved. I expect a slower, but steadier pace of economic growth in the U.S. and the U.K., while the Eurozone endeavors to maintain its recovery.
  • The U.S. economy advanced by an annualized 1.5% in the third quarter, which was below estimates. Narrowing exports and diminished manufacturing inventory were negatives, while personal consumption (automobile purchases) and government expenditures increased.
  • New jobless claims continue to show a stable labor market. The four-week moving average (which evens out volatility) was down for the seventh straight week, hitting a new 42-year low. Continuing claims for the week ending October 17 declined to 2.14 million.
  • Housing, a big part of our economy, continued moderate growth. In the year over year, new home sales gained 2.0% against a 13.5% price increase, while pending home sales rose 3%.
  • Personal incomes and consumer spending each grew by 0.1% in September, coming in below expectations. Core price increases were unchanged for the month and 12-month period, at 0.1% and 1.3%, respectively. The lack of growth in incomes and the low level of inflation probably keep the Federal Reserve from raising interest rates until 2016.
  • The U.K. economy grew by a disappointing 0.5% in the third quarter, according to provisional data, and by 2.3% in the year over year.
  • Preliminary data indicates that Eurozone consumer prices (excluding energy and food) rose by 0.9% in October, exceeding September’s increase. Meanwhile, September’s 10.8% unemployment rate was lower than projected, reaching a low not seen since 2012.
  • Japanese industrial production outpaced estimates in September, advancing for the first time in three months. Chemicals and electrical items (machinery, parts and devices) contributed most. However, production was 0.8% below its level from a year earlier.

The 1st week of November has a busy economic calendar with ISM (Institute for Supply Management) manufacturing and non-manufacturing indexes, motor vehicle sales, and the important October jobs report on Friday morning.  Thankfully, Congress passed a bill on Friday 10/30/15 that will extend government borrowing authority until March 15, 2017 and includes a two-year budget plan.  The level of debt is way too high but at least the uncertainty of a government shutdown is off the table.

In summary, I think we will see a bit less volatility with a slowly rising equity market through the end of the year.

November Calendar of Events   (comments and additions for future months are always welcome)

  • November is National Family Caregivers Month.   Please consider reaching out to a family member or friend who is caring for a loved one. Why not offer to give them a day off.

November 1st             Healthcare open enrollment – for coverage starting Jan 1, 2016 – runs through 12/15/15.   

November 3rd              Election Day (local elections).  Starts 1 year countdown to the next Presidential election.


November 11th           Veterans Day – let’s reach out a Vet and say thanks for your service

November 19th            Great American Smokeout – encourage a smoker to quit


November 26th       Thanksgiving – have a wonderful holiday 

Sources: Yahoo Finance, SEI Private Trust

Although information herein has been obtained from sources deemed reliable, its accuracy and completeness are not asserted. All opinions and estimates included in this report constitute the judgment of the financial advisor as of the dates indicated and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security.


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URGENT – Small Business Owners

URGENT – Small Business Owners

Healthcare Open Enrollment – Opportunity

Under the Affordable Care Act (ACA), small business employers (1 – 50 employees) must have at least a 70% participation rate (75% in NJ) of their employees to qualify for a Group health plan. The participation rate is based on the # of employees in the plan plus those with valid waivers (coverage via spouse, Medicare, or Medicaid) as a percentage of total employees.

For example, if the total employee count (including owners) is 5, then at least 4 employees must be in the plan or supply a valid waiver for the employer to qualify for a Group plan.  This 75% requirement makes it difficult to qualify for Group health coverage, especially for small employers.

GOOD NEWS – from Nov 15, 2015 through Dec 15, 2015 the 75% participation is not required. During this short window of time, small employers can apply for Group health coverage without any participation requirement for an effective date of Jan 1, 2016.

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