January Market Review from Sumner Wealth Management

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 swm noname    

- JANUARY 2018 -


 In This Edition:

  • 2018
  • Key Takeaways 2018                         
  • What to expect
  • About SWM



Market Performance

Stock Market (End of August)


 YTD '18

3 Year

 Total U.S. Market1 +6.3% +21.1% +11.1%
   Domestic Large Cap Equity2 +6.6% +21.8% +11.4%
   Domestic Small Cap Equity3 +3.3% +14.7% +10.0%
 International Equity4 +5.0% +27.2% +7.8%
   Developed International Equity5 +4.2% +25.0% +7.8%
   Emerging Market Equity6 +7.4% +37.3% +9.1%

Fixed Income (End of August)


 YTD '18

1 Year

 U.S. Investment Grade Bonds7 +0.4% +3.5% +2.2%
Cash Equivalent8 +0.3% +0.8% +0.4%
1Russell 3000 2S&P 500 Index 3Russell 2000 Index 4MSCI ACWI ex-U.S. Index 5MSCI EAFE Index 6iShares MSCI Emerging Markets Index 7Barclays Capital U.S. Aggregate Bond Index 8Barclays Capital 1-3 Month U.S. Treasury Bill Index   

Dear Visitor, 

When it comes to the global economy, the threat of storm clouds always seems to be hovering overhead. But heading into 2018, investors can see blue skies just about anywhere they look. From reduced political tensions in Europe to reform initiatives in India, to a more stable China, underlying conditions are decidedly upbeat. Indeed, the synchronized global economic recovery is gathering a head of steam.

Much of the good news, however, is reflected in asset prices, as stock and bond markets around the world have delivered positive results for much of the past year. In an environment characterized by healthy underlying growth but relatively high valuations, it is time for balance and flexibility in portfolios. Here are key takeaways and investment implications to consider as you position portfolios for 2018:


Key Takeaways

The global economic expansion is gaining momentum, but with valuations rising across most asset classes, selectivity is essential.

The U.S. economy is strong, but markets are expensive. Maintain a core allocation to U.S. equity, but consider rebalancing toward international and emerging market equities.

There is still room to run in international and emerging markets. Seek meaningful exposure to Europe’s improving health and rising consumer purchasing power in emerging markets.

It’s time to de-risk core bond portfolios. Ensure your bond portfolio is broadly diversified and does not have excessive high-yield exposure.

Soaring consumer confidence, a healthy jobs market and improving retail sales are giving the U.S. economy a further boost.

Tightening labor markets and faster wage growth will eventually lead to higher inflation, but generally favorable conditions will likely persist in 2018 

After years of solid market returns, valuations for most U.S. assets are at or near multiyear highs, so at this stage of the cycle a measure of caution is warranted.


What to expext in 2018

The global expansion is gaining momentum as the U.S. forges ahead and conditions improve in Europe. Low rates and mild inflation across the globe further contribute to a benign economic environment. But with volatility at multiyear lows, complacency has spread. Consumer optimism and rising wages have provided a further boost to a strengthening U.S. economy. Valuations are near multiyear highs across a number of asset classes. But a deeper look beyond market averages reveals opportunity for selective investors. Foremost are negotiations over the future of the North American Free Trade Agreement (NAFTA), which we see as a barometer for a new “America First” stance that could upset the global free-trade regime. Mexico, whose fortunes are closely tied to the future of NAFTA, tops a long list of EM elections.  


About Sumner Wealth Management

Our firm assist individuals, families, and businesses in proactively preparing themselves for a broad range of financial decisions and life events by helping our clients gain income protection, financial stability, with a solid plan.  We are an integrated, Wealth Manager Specialists. 

Mark Sumner
Financial Advisor


Sumner Wealth Management, Inc.          
142 South Cardigan Way, ste D                                                                                                                                      
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Mooresville, NC  28117                      
Direct (704) 905 - 3594                                         

Investment Management
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   Sumner Wealth Management | 704.905.3594 | www.SumnerWealthManagement.com

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