Slow, But Positive, Trading Week
WEEKLY UPDATE - DECEMBER 27, 2016
In the last full trading week of 2016, domestic markets were relatively quiet, with many people out of the office for the holidays. Nonetheless, all three major domestic indexes ended the week in positive territory. The S&P 500 was up 0.25%, the Dow gained 0.46%, and the NASDAQ added 0.47%. International equities in the MSCI EAFE were also up, increasing by 0.36%. The Dow continued to flirt with surpassing the 20,000 mark for the first time - reaching within fewer than 13 points at its highest trading point on Wednesday, December 20 - before closing at 19,933.81 for the week.
Outside of the markets, we received a number of reports that painted a mostly positive view of the U.S. economy.
- GDP revised up again: For its final report on economic growth in the third quarter, the Commerce Department adjusted the GDP up for the second time - to a 3.5% annual rate. This analysis shows the fastest economic growth in two years.
- Consumer sentiment hits nearly 13-year high: The monthly index measuring consumers' views on the current and future state of the economy increased by 4.7 points to reach 98.2 for December. This reading is the highest since January 2004.
- New home sales beat expectations: Economists predicted that new home sales for November would increase by 2.1%, but last week's data showed the increase was in fact 5.2%. Consumers anticipating higher interest rates in the future could be contributing to the expectation-beating results.
- Personal incomes stayed flat: Despite economists' predictions that personal incomes would increase by 0.3% in November, the Bureau of Economic Analysis' data showed them flatten. Even with last month's stagnation, personal incomes are up 3.5% for the year.
- Durable goods orders declined: After increasing by 4.8% in October, durable goods orders dropped by 4.6% in November - due largely to a 73.5% decrease in civilian aircraft orders. While no one likes to see a decrease, the report had several positive highlights, including an unexpectedly high increase in orders for U.S.-made capital goods.
Overall, even though last week was fairly slow for trading, we continue to see signs that the economy is improving - even if it is still far from perfect. We look forward to discovering what 2017 holds for investors and hope for more record highs and an economy that picks up speed as time goes on.
Monday: Markets Closed in Observance of Christmas Holiday
Tuesday: Consumer Confidence
Wednesday: Pending Home Sales Index
Friday: Bond Market Closes at 2 p.m. ET
Understanding Gift-Tax Exclusions
According to the IRS, a gift must be given with no expectation of receiving anything of equal value in return. Gifts can be cash, property, interest-free loans, payments made to a third party (like a school or hospital) on behalf of the recipient, below-market rate sales, and other types of property transfers. Generally, gifts that meet the following requirements are not taxable:
- Gifts that are less than the annual exclusion amount for the year ($14,000 in 2016 and 2017)
- Tuition or medical expenses
- Gifts to your spouse
- Gifts to qualified charities and certain political organizations
For more information about gifting and end-of-year tax issues, please contact a qualified tax professional.
Tip courtesy of IRS.gov
Boost Your Smash Factor
The efficiency with which you translate clubhead speed into your golf ball is known as smash factor - so named because of the ball's deformation as you strike it. Technically, smash factor is ball speed divided by club speed. The higher your smash factor, the better you will hit longer shots.
- Get your club professionally fitted. Your club shaft should flex at the optimal point midway through the swing to snap the ball into the air. Since everyone's swing is different, a professional fitting can help match the club shaft to the quirks in your swing.
- Speed up your wrists. Your wrists generate more than two-thirds of the clubhead's velocity. Speeding up your wrists will do a lot to improve the speed of the swing. A simple drill you can follow is to grip your club right next to the clubhead and swing it one-handedly upside down. Listen for the club's rushing sound whipping through the air, which should come at your swing's lowest point. Repeat the drill with both hands, focusing on increasing the speed at the bottom of the swing.
Tip courtesy of Zach Allen | Golf Tips Mag
Longer Life with Omega-3s
Fat is good! At least Omega-3 fatty acids are, and recent research shows that they can increase life span. Eating foods with high levels of Omega-3 fatty acids such as salmon, flaxseed, walnuts, and dark leafy vegetables may also protect against depression, dementia, cancer, and arthritis.
Tip courtesy of OnHealth
Protect Plants from Cold Weather with Plastic Bottles
Cold weather can kill delicate seedlings, even if it's just an overnight drop in temperature. Instead of using expensive glass cloches or giving up on your garden, reuse clean plastic soda bottles as mini greenhouses. Here's how:
- Collect milk jugs, two-liter bottles, plastic cat litter jugs, and small water bottles.
- Rinse them clean, and cut the bottom off with a utility knife. Match the bottle size to the plant you need to cover, making sure the leaves don't touch the sides of the bottle.
- Cover the plant and push the edges of the bottle about an inch into the soil.
- Cover the seedlings at least an hour before sunset to give the air inside the bottle time to warm.
Tip courtesy of SFGate
Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.
Diversification does not guarantee profit nor is it guaranteed to protect assets.
International investing involves special risks such as currency fluctuation and political instability and may not be suitable for all investors.
The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the NASDAQ. The DJIA was invented by Charles Dow back in 1896.
The Nasdaq Composite is an index of the common stocks and similar securities listed on the NASDAQ stock market and is considered a broad indicator of the performance of stocks of technology companies and growth companies.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indices from Europe, Australia and Southeast Asia.
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The S&P/Case-Shiller Home Price Indices are the leading measures of U.S. residential real estate prices, tracking changes in the value of residential real estate. The index is made up of measures of real estate prices in 20 cities and weighted to produce the index.
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