Investment Commentary –November 20th, 2017

Market Indices as of Market Close November 20th, 2017
Dow 23,430 (18.56% YTD)
S&P 2,582 (15.33% YTD)
NASDAQ 6,790 (26.15% YTD)
Global DOW 2,951 (16.75% YTD)
Gold $1,277 (9.57%)
OIL $56.23 (-1.45%)
US 10Y Treasury 2.365 (-8.06%)
Barclay Bond Aggregate (3.20% YTD)

Yellen Says She’ll Leave Fed Once Powell Is Sworn In as Chairman

Federal Reserve Chair Janet Yellen said she will step down from its Board of Governors once her successor is sworn into the office, widening the scope for President Donald Trump to shape the U.S. central bank’s leadership for years to come.

Trump has nominated Jerome Powell to replace Yellen, 71, when her term ends in February, though his chairmanship is still subject to Senate confirmation. That move bucked a long-standing tradition of presidents reappointing their predecessor’s Fed pick.

“As I prepare to leave the Board, I am gratified that the financial system is much stronger than a decade ago, better able to withstand future bouts of instability and continue supporting the economic aspirations of American families and businesses,” Yellen, the first woman to lead the U.S. central bank, wrote Monday in her letter of resignation to Trump.

Her decision to leave will give Trump a fourth spot to fill on the Fed’s seven-person Board of Governors in Washington, including a vice chairman spot. The White House has said that Trump is focused on making a selection for that position this year.

News around the web:

Volatility perks up

Although stocks were flat overall for the week, there were three big daily moves, as the Dow fell 138 points on Wednesday, climbed 187 points on Thursday, and dropped 100 points on Friday. The CBOE Volatility Index rose to its highest level in three months, although it remained below its historical average.

Tax movement

Thursday’s passage of a Republican-authored tax overhaul by the U.S. House of Representatives provided a positive catalyst for stocks, and the Dow gained 187 points. The package cleared the House on a 227­­­–205 vote, moving the debate to the Senate, which is considering its own tax measure.

Flat market

On the heels of a modest decline the previous week, U.S. stock indexes were little changed as the Dow and the S&P 500 fell slightly and the NASDAQ Composite posted a small gain.

On tap this week:

Leaders last week were Servic es, Technology and Financials. Laggards were Basic materials and Utilities.

Black Friday Fun Facts:

Black Friday became the biggest shopping day of the year in 2001

Although it’s often touted as the biggest shopping day of the year, the day didn’t earn the designation consistently until the 2000s.

That’s because, for many years, the rule wasn’t that Americans loved deals, it was that they loved procrastinating. So up until that point, it was the Saturday before Christmas that typically saw the most wallets being emptied.

Black Friday is becoming extinct

Wal-Mart, the world’s largest retailer, broke the Black Friday tradition in 2011, when it opened its store on Thanksgiving evening. Ever since, retailers have been in a race to catch up and now, 33 million Americans said they planned to shop immediately after turkey.

But don’t worry – this time, retailers have come up with a name themselves: “Grey Thursday”.

The views presented are not intended to be relied on as a forecast, research or investment advice and are the opinions of the sources cited and are subject to change based on subsequent developments. They are not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investments.