Investment Commentary –October 24th, 2017

Market Indices as of Market Close October 24th, 2017
Dow 23,441 (18.62% YTD)
S&P 2,569 (14.75% YTD)
NASDAQ 6,598 (22.58% YTD)
Global DOW 2,965 (17.30% YTD)
Gold $1,278 (9.63%)
OIL $52.48 (-8.03%)
US 10Y Treasury 2.42 (-2.34%)
Barclay Bond Aggregate (3.11% YTD)

Stock market would see ‘setback’ if Trump tax package fails, says BlackRock’s Fink

The head of the world’s largest asset manager says stock market values don’t yet reflect the prospects for corporate tax cuts and other measures that are part of a proposed U.S. tax overhaul.
“I think very little is baked in,” said Larry Fink, chairman and chief executive of BlackRock Inc. BLK, -0.14% which has $5.7 trillion in assets under management, in an interview with CNBC Tuesday.

Speaking on the sidelines of a conference in Riyadh, Fink said the stock market’s continued rally has been driven largely by global growth. He said investors are taking more of a “wait-and-see” attitude on tax plans put forward by the Trump administration and the Republican Congress, given earlier policy setbacks.

“Policy has proven to be disappointing so far,” he said, adding that he expects to see tax legislation pass in the fourth quarter of this year or first quarter of 2018.

If it does pass, “I think the market will see another leg up,” he told CNBC. “If we did not get tax reform, we would have a market setback.”

News around the web

GDP ahead: The U.S. government’s initial estimate of third-quarter GDP is expected to be one of the most closely watched economic reports this week. Friday’s report could show the extent to which damaging hurricanes in September weighed on the nation’s economic activity.

Quiet trading: The recent drop in U.S. stock market volatility has been accompanied by a decline in trading. Through the first three weeks of October, average daily trading volume across major exchanges was down 12% relative to all of 2017, according to the Wall Street Journal.

On tap this week: Third-quarter GDP, advance estimate, U.S. Bureau of Economic Analysis


Leaders this week were Industrials, Financials and Basic materials. Laggards were Consumer goods, Basic Materials, Healthcare and Conglomerates.

This day in financial history: A Sneak Peak

Black Thursday occurred the week before the crash of 1929; it was a preview to the hard times ahead, when Wall Street’s shares would evaporate overnight.

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.