May 2018 Monthly Outlook – Markets don’t go straight up (except for 2017)

After the almost straight up move in the equity markets in 2017, this year has felt positively negative.  In fact, we have essentially been moving sideways, as the S&P 500 finished April 2018 with a year-to-date decline of less than 1%.  Sometimes, especially after strong periods of growth, the stock market goes through a period of consolidation.  For example, there have been three separate extended consolidation periods since the low during the 2008/2009 financial crisis.  I believe we are in such a period right now.  I don’t know how long it will last, but I remain confident that the fundamentals in the market and economy support a continuation of this secular bull market.  I see no indications of a major downturn in the markets or a slowdown in the economy.


Having said that, I do think the equity markets face a number of headwinds in the near-term:

  1. Inflation and interest rates have started to rise.  10 year US Treasury interest rate is now right at the psychologically important 3% level.
  2. Heightened uncertainty around trade / tariffs.
  3. Geo/political risks – especially in the Korea’s.
  4. Seasonally weak period for stocks.

To address these headwinds, I am making small adjustments to our portfolios, primarily rotating from more growth oriented investments into lower volatility investments.  Lower volatility investments have outperformed the overall market from May – October over the last 20 year.


Source: CFRA


Feel free to call if you have any questions.  Please share this report with anyone you feel would benefit from the information.

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

  • May is National Mental Health awareness month.  Nearly 44 million American adults, and millions of children, experience mental health conditions each year. Let’s all get educated on this issue and work towards acceptance and inclusion of people dealing with mental health issues.


May 5th                       Cinco De Mayo – stay thirsty my friends                 

May 13th                     Mother’s Day – wishing all mom’s, grandmothers, and great grandmothers a wonderful day.

May 19th                       Armed Forces Day.  Dedicated to recognizing those presently serving in our armed forces

May 23rd                     My daughter Caryn’s birthday  

May 28th                     Memorial Day – let’s remember and give thanks to all who served our country


Sources:  Raymond James & Associates, CFRA,


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.

Investing involves risk and you may incur a profit or a loss. Diversification does not ensure a profit or ensure against a loss. There is no assurance that any investment strategy will be successful.  Past performance is no assurance of future results.

Please consider the charges, risks, expenses and investment objectives carefully before investing. Please see a prospectus containing this and other information. Read it carefully before you invest or send money.

Information provided should not be construed as legal or tax advice.  You should discuss any tax or legal matter with the appropriate professional.

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