The Only Investing Goal that Matters: Your Own!

Eagle Wealth Management |
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Weekly Market Commentary

When it comes to financial goals, the only ones that matter are yours.

Listen, we realize any discussion of goals can be tricky.  But at least for this discussion, we find it helpful to think of a goal simply as an object of desire.  It’s something we want.

But here’s the rub: We are really bad at knowing what we actually want.

In fact, we learn what we want by watching what other people want.  From the youngest age, we learn to desire by seeing what our parents, siblings, and peers desire, followed eventually by what people on social media desire.

In a very real sense, we co-opt other people’s goals because it’s actually very hard to get clear about our own.

This can wreak havoc in so many areas of our lives, but particularly when it comes to our relationship with money.

There’s an old saying that we spend money we don’t have to buy things we don’t want to impress people we don’t even like.  This happens when we shop for cars or houses or investments.

You hear your wealthy uncle talking about how important it is to own municipal bonds.  He must be really smart because he has a bunch of money, right?  Suddenly, you think you should go buy municipal bonds, too.

You hear about all the cool kids investing in startups and all the fancy people buying Teslas.  Maybe you should do that, too.

But here’s the thing: None of that matters. None of it.

The only goals that matter when it comes to your money are your goals.  Not anyone else’s.

So… what are your goals?  If you notice your goals or priorities are shifting, let’s have a conversation.

Warm regards,

Your Eagle Wealth Team

The Week on Wall Street

Undaunted by another Fed rate hike and news of a contracting economy, the stock market rallied last week on better-than-expected corporate earnings.

The Dow Jones Industrial Average increased 2.97%, while the Standard & Poor’s 500 picked up 4.26%. The Nasdaq Composite index gained 4.70% for the week. The MSCI EAFE index, which tracks developed overseas stock markets, rose 0.95%.1,2,3

 

Stocks Rally on Earnings

It was an inauspicious start to the week after a big-box retailer missed earnings and reduced forward guidance on Tuesday, sparking a broad market retreat.

But sentiment improved following mega-cap technology company earnings that proved better than expected. Enthusiasm gathered steam in the wake of the Fed’s 0.75% rate hike, boosted by Fed Chair Powell’s comments following Wednesday’s Federal Open Market Committee meeting. Powell indicated that it might become appropriate to slow the pace of future hikes, and he didn’t believe the economy had entered into recession. Stocks on Thursday shrugged off news of a second-consecutive quarter of negative economic growth to build on Wednesday’s gains as fresh earnings continued to comfort, if not impress, investors.4

 

Economy Contracts

The U.S. economy shrank at an annualized rate of 0.9% in the second quarter as consumers pulled back on spending and businesses worked to reduce inventories. It was the second-consecutive quarter of negative economic growth, meeting the technical definition of a recession. Unlike past recessions, hiring has been strong all year, with the unemployment rate near historic lows.5

The economic slowdown was attributable primarily to decreases in inventories, a deceleration in the housing market, and lower government spending. Consumer spending increased a tepid one percent, well below the inflation rate during the same period.6

 

THE WEEK AHEAD

KEY ECONOMIC DATA


Monday:  Institute for Supply Management (ISM) Manufacturing Index
Tuesday:  Job Openings and Labor Turnover Survey (JOLTS)
Wednesday:  Automated Data Processing (ADP) Employment Report. Institute for Supply Management (ISM) Services Index. Factory Orders
Thursday:  Jobless Claims
Friday:  Employment Situation
 

Source: Econoday, July 29, 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


Tuesday:  Advanced Micro Devices, Inc. (AMD), PayPal Holdings, Inc. (PYPL), Caterpillar, Inc. (CAT), Prudential Financial, Inc. (PRU), Starbucks Corporation (SBUX), Marathon Petroleum Corporation (MPC), Marriott International, Inc. (MAR)
Wednesday:  CVS Health Corporation (CVS), Fortinet, Inc. (FTNT), PPL Corporation (PPL), Booking Holdings, Inc. (BKNG), Occidental Petroleum Corporation (OXY), Regeneron Pharmaceuticals, Inc. (REGN)
Thursday:  Block, Inc. (SQ), Twilio, Inc. (TWLO), Amgen, Inc. (AMGN), Eli Lilly and Company (LLY), ConocoPhillips (COP), Air Products and Chemicals, Inc. (APD), Albemarle Corporation (ALB), Kellogg Company (K)
Friday:  Berkshire Hathaway, Inc. (BRK.A)
 

Source: Zacks, July 29, 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.

 

Timeline Description automatically generated

 

1. The Wall Street Journal, July 29, 2022

2. The Wall Street Journal, July 29, 2022

3. The Wall Street Journal, July 29, 2022

4. The Wall Street Journal, July 27, 2022

5. CNBC, July 28, 2022

6. CNBC, July 28, 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.

U.S. Treasury Notes are guaranteed by the federal government as to the timely payment of principal and interest. However, if you sell a Treasury Note prior to maturity, it may be worth more or less than the original price paid. Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.

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.