A Record Setting Year

A Record Setting Year

December 26, 2017

Krista Biernbaum
Securities Analyst 

We are officially in the final week of 2017 and what a year it has been! I do not think anyone predicted how positive of a year it would be – record-setting in many regards.

One impressive and unexpected event is the magnitude of the stock market rally, not only in the U.S. but across the globe. In the U.S., we hit new all-time highs on a regular basis. The S&P 500 has fifty-three new all-time highs thus far this year and the Dow Jones Industrial Average has seventy through last Friday. But hey, who’s counting! New peaks while volatility was pretty much non-existent; it doesn’t get much better than that.

To illustrate how good it has been, below is a chart from the Wall Street Journal’s Daily Shot, with data provided by Morningstar™. The chart shows the monthly returns for the S&P 500 going back to 1987. As you can see, every year has at least some red; that is not the case this year. If you look at 2017, it’s nothing but green. With just a couple trading days left, we are on track to see no red months this year for the first time in at least thirty years.  

 

What contributed to the impressive rally this year is an improving global economy. All forty-five countries monitored by the Organization for the Economic Cooperation and Development (OECD) are on track to see their economies grow this year for the first time in a decade. Also, State Street Global Advisors expects thirty-three of those countries to see economic growth accelerate this year, the highest number since 2010. Economic growth has surprised to the upside this year, here and abroad.

While not a downside, history has shown that any change in valuations of this magnitude does not move all parts of a portfolio in unison. Regular client reviews and rebalancing are an important part of our responsibilities to you. Good times or bad, we will always do a better job for you if we communicate our intentions and understand your goals. But it’s more fun for all when the markets are booming! Please call your Security National Bank Wealth Management Advisor today to schedule your year-end review.

On behalf of everyone in Wealth Management, Happy Holidays and a Happy New Year!