Question

Write a summary of US stock market in 2018, include S&P 500 index return, key issues facing the market and economy and major events from the Fed.

Answer 1

Solution

Summary of US Stock Market 2018:-

• After reaching new all-time highs in September, the stock market pulled back in October.

• Volatility returned to most markets, similar to the circumstance  that unfolded earlier this year.

• Stocks and bonds, at US and abroad, generally ended lower for the month, but a rally at the end of the month helped to ease some of the uncertainty

• Trying to understand the specific causes of short-term fluctuations is often an exercise in uselessness.

• But in October, there seemed to be two major Issues  that may have influenced markets-

1) The ongoing worries about trade conflict with china and impact of this conflict might have on econamics and corporate profit . this conflict may be main causes of volatility in us market.The impact of the trade confilict  on corporate profits came into focus this past month as companies began reporting financial results for the third-quarter.

2)Volatility continued due increase in interest Rate.The U.S. economy grew by +3.5% in the third quarter, but this strong growth contributed to concerns about the Federal Reserve raising interest.The worry is the fed could raise interest rate faster than expected.

• Volatile phases in the markets can feel unsettling.

• During these phases, it can be helpful to keep your sight set on your long-term goals and to remember that risk is part of investing

What is S&P 500 INDEX?

1. The S&P 500 index(Standard Poor's 500 index) is a market capitalization weighted index of the 500 largest US Publicly traded companies by market value.
2. The index is widely regarded as the best single size of large cap US equities.
3. In other Common US stock market Benchmark include the Dow Jones industrial Average or Dow 30 and russell 2000 index for the small cap Index.

In the year 2018 a rapid decline like this be vary unsettling, here some context to help you maintain your goal-

• For all 2018 the S&P500 is Flat. This is disappointing return, but it's for from the worst that can happen when investing in stock market.
• Going Back over the last five years, the S&P 500 is up about 50%. Long term investor rewarded thier willingness to day to day market volatility.
• For most situation , you should be invested in diversified portfolio of bond , US stocks and international Stocks. this can help you effect of decline in any market.

Key Issues Faces the Market and Economy

The Following two Issues Faces by US Market and Economy

1) The ongoing worries about trade conflict with china and impact of this conflict might have on econamics and corporate profit . this conflict may be main causes of volatility in us market.The impact of the trade confilict  on corporate profits came into focus this past month as companies began reporting financial results for the third-quarter.

2)Volatility continued due increase in interest Rate.The U.S. economy grew by +3.5% in the third quarter, but this strong growth contributed to concerns about the Federal Reserve raising interest.The worry is the fed could raise interest rate faster than expected.

Major Events From the Fed:-

1. The Fed is run by foreigners.
2. The Fed is not part of the US government.
3. The Fed prints money.
4. The Federal Reserve is not audited.
5. The Fed had President John F. Kennedy killed.