Another Record Closing High – Monday Morning Market Memo – January 20, 2020

Another Record Closing High – Monday Morning Market Memo – January 20, 2020

Good morning,

The markets are closed today in observance of Martin Luther King Jr. Day. We’re not sure if the Bull appreciates the day off to rest, or if it would rather simply keep on running. The stock market put up solid gains again last week with the Dow Jones Industrial Average rising 1.8%, the NASDAQ Composite jumping 2.3%, and the Standard & Poor’s 500 Index adding 2%. All three of these major indices finished last week at record highs – 29,348 – 9,389 – and 3,330 respectively. As a point of interest, and relating to these gains, Alphabet became the newest member of the $1 trillion market-cap club.

Factors adding to the positive market momentum include the signing of the “phase one” trade deal between the U.S. and China, Senate passage of the U.S-Mexico-Canada trade agreement (USMCA), strong data on housing starts, and a positive start to earnings season. Big financials such as JPMorgan Chase, Citigroup, and Morgan Stanley all reported earnings that came in better-than-expected, creating a positive tone regarding the outlook for upcoming reports.

Companies scheduled to report this week include Halliburton, International Business Machines, Netflix, Johnson & Johnson, Intel, Intuitive Surgical, Procter & Gamble, Comcast, Union Pacific, and American Express. Looking at expectations in total, S&P 500 earnings for the fourth quarter of 2019 are expected to decline 2.1% according to data from FactSet. So in general, companies have a low hurdle to clear in order to “impress” investors. As always, let us know if you have any questions or would like to set up a meeting.

All the best – Southport Station Financial Management, LLC