The Contagious Magic of Micro-actions

Eagle Wealth Management |
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Weekly Market Commentary

When tackling big, audacious goals, you don’t need big, audacious actions. All you need is the contagious magic of micro-actions.  Because micro-actions spread.

Let’s look at an example.

For a lot of people, when they plan out their next day, they often don’t feel like exercising.  But we know we’ll feel way better if we do.  So, what should we do when we get up in the morning?  Don’t commit to a program to lose twelve pounds in twelve days or promise to run for forty minutes.  Just put on gym clothes.

That’s it.

And then, since the gym clothes are on, we’re way more likely to walk to the gym.

What happens next is what almost always happens when someone steps into a gym: we’ll see the bikes/treadmill/elliptical and think, “I bet it will feel good to get on one of those for a few minutes.”

We exercise, we stretch, and then we decide to eat a healthy breakfast instead of sugary garbage since We’re on a roll.

Later at work, we’re extra productive since our body feels great.  Etc, etc.

Turns out, micro-actions are almost always more effective than grand gestures.  There’s a reason so many New Year's Resolutions fail.  The problem isn’t the goals, it’s the way we go about trying to tackle them.  We try to go big and burn out, forgetting that “slow and steady wins the race.”

If we wake up and say, “OK, today, you are going to exercise for an hour, eat a healthy breakfast, and get a ton of work done,” that would have felt awfully daunting.  Maybe we would’ve shrunk in fear from such a hard day and never set foot in the gym at all.

The same applies to big financial goals like paying off debt, buying a house, or preparing for retirement.  The magic here is in breaking down big, hard, sometimes even scary goals into attainable pieces.  “What’s the next smallest thing I can do?” That’s the question you’re trying to answer.  Start there and let the contagious magic of micro-actions do the rest.

Do you have any personal micro-actions that help you get things done?  Share with us - we’d love to hear from you.

The Week on Wall Street

Prospects of cooling inflation powered a rally in stock prices last week despite growing recession concerns.

The Dow Jones Industrial Average gained 5.39%, while the Standard & Poor’s 500 climbed 6.45%. The Nasdaq Composite index rose 7.49% for the week. The MSCI EAFE index, which tracks developed overseas stock markets, edged 0.78% higher.1,2,3

Stocks Bounce

Declining energy and food prices and falling bond yields signaled a potentially improving inflation outlook, buoying investor sentiment. The rally in stocks was most powerful on the first and final trading days of a holiday-shortened week. Stocks turned a bit choppy mid-week as investors digested Fed Chair Jerome Powell’s Senate appearance but resumed their momentum on Thursday and rallied Friday as rate-hike expectations eased.

Though the weekly gain was a welcome respite from the market’s downward trend, declining bond yields and falling food and energy prices can also be interpreted as signs of slowing economic growth, which may represent a headwind for corporate earnings in the months ahead.

Powell Testifies

Fed Chair Jerome Powell told members of the Senate Finance Committee that the Fed is committed to lowering inflation and moving quickly to do so. He conceded that a recession could result from the Fed’s inflation-fighting efforts and acknowledged that some of the forces driving inflation (e.g., supply chain, war) are out of the Fed’s control.4

Perhaps the most exciting part of his testimony was what he didn’t say, which was a definitive statement on future hikes. Instead, Powell told lawmakers that he “anticipate[s] that ongoing rate increases will be appropriate.” Before his testimony, the Fed published a new research paper that found a greater than 50% chance of recession in the next four quarters.5

 

THE WEEK AHEAD

KEY ECONOMIC DATA

Monday: Durable Goods Orders
Tuesday: Consumer Confidence
Wednesday: Gross Domestic Product (Third Estimate for Q1)
Thursday: Jobless Claims
Friday: Institute for Supply Management (ISM) Manufacturing Index

 

Source: Econoday, June 24, 2022
The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.

 COMPANIES REPORTING EARNINGS


Wednesday: General Mills, Inc (GIS)
Thursday: Micron Technology, Inc. (MU), Constellation Brands, Inc. (STZ), Walgreens Boots Alliance, Inc. (WBA)
 

Source: Zacks, June 24, 2022
Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.

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Any companies mentioned are for informational purposes only, and this should not be considered a solicitation for the purchase or sale of their securities. Any investment should be consistent with your objectives, time frame, and risk tolerance

1. The Wall Street Journal, June 24, 2022

2. The Wall Street Journal, June 24, 2022

3. The Wall Street Journal, June 24, 2022

4. The Wall Street Journal, June 22, 2022

5. The Wall Street Journal, June 22, 2022

Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost.

The forecasts or forward-looking statements are based on assumptions, may not materialize, and are subject to revision without notice.

The market indexes discussed are unmanaged, and generally, considered representative of their respective markets. Index performance is not indicative of the past performance of a particular investment. Indexes do not incur management fees, costs, and expenses. Individuals cannot directly invest in unmanaged indexes. Past performance does not guarantee future results.

The Dow Jones Industrial Average is an unmanaged index that is generally considered representative of large-capitalization companies on the U.S. stock market. 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 technology and growth companies. The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) and serves as a benchmark of the performance of major international equity markets, as represented by 21 major MSCI indexes from Europe, Australia, and Southeast Asia. The S&P 500 Composite Index is an unmanaged group of securities that are considered to be representative of the stock market in general.

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International investments carry additional risks, which include differences in financial reporting standards, currency exchange rates, political risks unique to a specific country, foreign taxes and regulations, and the potential for illiquid markets. These factors may result in greater share price volatility.

Please consult your financial professional for additional information.

This content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. Please consult legal or tax professionals for specific information regarding your individual situation. This material was developed and produced by FMG Suite to provide information on a topic that may be of interest. FMG is not affiliated with the named representative, financial professional, Registered Investment Advisor, Broker-Dealer, nor state- or SEC-registered investment advisory firm. The opinions expressed and material provided are for general information, and they should not be considered a solicitation for the purchase or sale of any security. Copyright 2022 FMG Suite.