Morning Market Preview for September 9th, 2024

Arena Investor is modern planning and investing built for the busy, hardworking professionals who know their money needs more attention but don't have the time, or simply want better work-life balance

Good morning, Heroes!

Here’s your Morning Market Preview for September 16th, 2024
Read, or listen relaxingly for a few minutes – whichever you prefer!

Key Economic Reports

• No reports to mention for Monday.

Key Events & Earnings Reports Today

• A handful of lesser-known companies report on Monday: Hide Tide Inc, RF Industries, Vince Holding Corp, and Ocean Power Technologies. Likely, none of these reports will move the market.

The Fed

• All eyes are on the Fed. On the 17th and 18th the key members meet to decide on a rate cut. The consensus had been that the Fed would cut rate by a quarter percent, but a lot of energy has formed around a half percent cut with the charge led by former New York Fed President William Dudley, saying “I think there’s a strong case for 50.”

Stocks

Year-to-Date Performance:

• Up Most: Tech has taken over the top spot with a strong week last week, now up 26.21%. Second is Utilities, now up 23.18%.
  
  
• Down Most: Energy is down the most, but is still barely up on the year overall at 1.83%. Down second-most is Materials, up 7.95% on the year.

5 Day Moving Average: This is the percent of Large Cap stocks above their 5 day average

• Up Most: Utilities and Consumer Discretionary are now up a whopping to 97% and 96% of their Large Cap above their 5 day average, respectively. Tech and Materials are tied for second best over the last 5 days with 93% of their Large Caps above their 5 day averages.
  
  

• Down Most: Energy is down most with 59% of its Large Cap stocks above its 5 day average. And Consumer Staples was second to last, although it had 68% of its Large Cap stocks above their 5 day averages.
  
  
• Overall, it was a great week for these sectors, as we get a new week started.

Crypto

• Bitcoin: Up to about $59,826, up a massive 42.24% this year.
  
  
• Ethereum: Opening at about $2,409, and staying positive at 2.47% this year.
  
  
• Top Gainers Recently: Litecoin left the rest of the field in the dust recently, up 5.74% as of this report.

Bonds

• 2-Year Treasury Yield:  At 3.603%, it has continued its yield decline this year.
  
  
• 10-Year Treasury Yield: At 3.649%, it also continues its yield decline this year.

Gold

• Price: Gold has had an amazing year, up 24.92%, now at about $2,576.

Real Estate

• 30-Year Fixed Mortgage Rate: Down just a bit, now to 6.14%. The mortgage rate has dropped about 7.95% this year.

Geopolitical Aspects

• Geopolitical tensions, particularly in the Middle East and between major powers like the U.S. and China, influence markets significantly. Escalations or de-escalations in these regions can lead to immediate market volatility, affecting oil prices, stock markets, and investor sentiment. The potential for broader conflict or trade disruptions adds uncertainty, with markets often reacting swiftly to geopolitical news.

Built for The One in the Arena

Arena Investor is on a mission not only to help with financial planning, and investment management, but also with education. Keep reading, watching, following, and sharing great Arena Investor content. And as always if you want professional advice, we are glad to be your teammate – along a financial journey you can actually enjoy.

You’re the Hero.
    We’re the Guide.

P.S. 

Some Simple Explanations of Key Concepts to Level Up Your Financial Education

Stock Market Sectors: Stocks are divided into sectors like technology, health care, or energy. Each sector performs differently based on economic conditions, policy changes, or technological advancements. For instance, tech stocks might thrive in a high-growth environment, while energy stocks could respond to oil price fluctuations.

Bonds and Treasury Yields: When you buy a bond, you're lending money to the issuer (like the government) in exchange for interest over time. The yield is this interest rate. Higher yields can mean higher risk or inflation expectations, affecting all asset classes, including stocks and real estate.

Cryptocurrencies: These are digital or virtual currencies not backed by any government or physical asset. Their value can soar or plummet rapidly due to speculation, regulatory news, or technological developments.

Gold: Often seen as insurance against economic downturns or inflation. When economies are uncertain, gold tends to rise in value as investors seek safe investments.

Real Estate: Mortgage rates directly impact housing affordability. Lower rates can lead to a housing boom, but if rates rise, demand can fall, affecting home prices.

Understanding these aspects of the investing arena can help investors in making informed investment decisions.

You’re the Hero.
    We’re the Guide.

Arena Investor is modern planning and investing built for the busy, hardworking professionals who know their money needs more attention but don't have the time, or simply want better work-life balance

Good morning, Heroes!

Here’s your Morning Market Preview for September 18th, 2024
Read, or listen relaxingly for a few minutes – whichever you prefer!

Key Economic Reports

• Housing Starts, previously 1.24 million, and the market expects 1.31 million in this report.
  
  
• Building Permits, previous 1.4 million, with an expected 1.41 small uptick.
  
  
• FOMC Interest Rate Decision, expected at 2:30pm Eastern.

Key Events & Earnings Reports Today

• Steelcase and Sang Technologies report today, but all eyes are on the Fed.
  
  
• Boeing is in the middle of a strike, and the company has frozen hiring and is discussing furloughs as well. The strike began on September 13th.

The Fed

• Today is the day we likely get our first rate cut since The Fed began hiking rates in March 2022. It was the fastest rate hike in American history. The market hasn’t seen a rate cut since March 2020.

Stocks

Year-to-Date Performance:

• Up Most: Although down just a bit in the last day, Tech leads the pack, up 25.01% this year. Utilities was also down just a tad, but is still the second-best on the year year, up 24.08%.
  
  
• Down Most: Important: no sectors are negative on the year. The smallest gain has been in Energy, up 3.05% this year. Second-to-last is now Consumer Discretionary, up 8.73% this year.

5 Day Moving Average: 

• Up Most: 100% of Energy Large Cap stocks are now above their 5 day average. Materials is close to the top position too, with 96% of its Large Caps above their 5 day average.
  
  

• Down Most: Real Estate stocks have had a bad 5 days, and only 26% of Large Caps are above their 5 day average. Next closest is Health Care at 49%.
  
  
• Overall, investors are trying to position themselves ahead of The Fed’s decision, and in light of some data that the economy is slowing.

Crypto

• Bitcoin: Over the past day, it is up about $60,155, which puts it at a staggering 43% gain on the year.
  
  
• Ethereum: It’s been a good day for Ethereum, and is up to about $2,358, which means a 2.15% gain on the year.
  
  
• Top Gainers Recently: Uniswap is up most as of this report, 7.14% on the day.
  
  
• Important to note: Crypto markets are always open and prices change constantly.

Bonds

• 2-Year Treasury Yield:  At 3.599%, it has continued its yield decline this year.
  
  
• 10-Year Treasury Yield: At 3.644%, it also continues its yield decline this year.

Gold

• Price: Gold was down about 50 basis points the last day, now about $2,569 per ounce, up 24.57% on the year.

Real Estate

• 30-Year Fixed Mortgage Rate: Down just a bit, now to 6.11%. The mortgage rate has dropped about 8.4% this year.

Geopolitical Aspects

• Tensions in key oil-producing regions impacting energy markets, with potential for new trade agreements influencing global economic stability.
  
  
• Europe: Economic recovery post-COVID, with a focus on green initiatives is affecting various industries.
  
  
• Asia: Growth in tech sectors, while facing challenges from supply chain disruptions due to geopolitical issues continues.

Built for The One in the Arena

Arena Investor is on a mission not only to help with financial planning, and investment management, but also with education. Keep reading, watching, following, and sharing great Arena Investor content. And as always if you want professional advice, we are glad to be your teammate – along a financial journey you can actually enjoy.

You’re the Hero.
    We’re the Guide.

P.S. 

Some Simple Explanations of Key Concepts to Level Up Your Financial Education

• Economic Reports: These are snapshots of the economy's health. For instance, Retail Sales show consumer spending, crucial for economic growth. Industrial Production indicates manufacturing strength.
  ‍
• Federal Reserve (The Fed): This is like the economy's central bank in the U.S. They control interest rates, influencing borrowing costs, which can affect everything from your mortgage to stock prices. A rate cut typically means they want to stimulate economic activity.
  ‍
• 1 Basis Point (BPS) equals 0.01%. And here's why this is useful:

• Precision: Financial changes are often tiny. For example, if an interest rate goes from 3.50% to 3.51%, that's an increase of just 0.01%, or 1 basis point. It's easier to say "1 basis point" than "point zero one percent."
• Clarity: When discussing changes, especially small ones like those in interest rates, basis points avoid confusion. Imagine discussing if a rate changed by 0.1% or 0.01% over the phone. Saying "10 basis points" or "1 basis point" is clear.
• Consistency: It's a universal standard in finance. Whether you're talking about stock returns, bond yields, or central bank rates, basis points keep the conversation standardized.

Each of these elements interacts, creating the dynamic we call 'the market'.

Understanding these aspects of the investing arena can help investors in making informed investment decisions.

You’re the Hero.
    We’re the Guide.

Total Term is a vital metric that compares your current net worth to your estimated annual spending. This guide will explain what Total Term means, its significance, and how working with an Arena Investor Advisor can optimize your financial strategy.

What is Total Term?

Total Term is a financial ratio that measures the longevity of your current net worth if you had to live on it without any additional income. It is calculated by dividing your current net worth by your estimated annual spending. This ratio helps you understand how many years you could sustain your current lifestyle solely based on your accumulated assets, making it an essential figure for retirement planning and financial stability assessments.

Importance of Understanding Your Total Term

1. Retirement Planning: One of the most critical uses of the Total Term is in retirement planning. It provides a clear estimate of how many years your current assets can fund your retirement, helping you make informed decisions about when you might afford to retire or how much more you need to save.

2. Financial Health Assessment: Total Term gives a snapshot of your financial health and independence. A longer Total Term suggests a strong financial cushion and stability, while a shorter Total Term might indicate the need for increased savings, investments, income adjustments, or spending changes.

3. Spending and Investment Strategies: Understanding your Total Term can influence both your spending habits and investment strategies. It helps in balancing between saving enough to extend your Total Term and investing wisely to grow your net worth.

Calculating Your Total Term

To calculate your Total Term, you need to first determine your net worth, which is the sum of all your assets minus any liabilities. Then, estimate your annual spending, which includes all regular expenses for the year. Finally, divide your net worth by your estimated annual spending. For example, if your net worth is $500,000 and your annual spending is $50,000, your Total Term is 10 years.

How an Arena Investor Advisor Can Help

1. Comprehensive Financial Review: An Arena Investor Advisor starts by assessing your entire financial landscape—assets, liabilities, income, and expenses—to accurately calculate your Total Term. This initial review lays the groundwork for all further advice.

2. Tailored Financial Planning: Depending on your Total Term and financial goals, your advisor might suggest specific strategies to improve your financial longevity. This could involve increasing your savings rate, adjusting your spending habits, or optimizing your investment portfolio for better growth and sustainability.

3. Regular Monitoring and Adjustments: As your financial situation evolves—due to changes in income, expenses, or life circumstances—your Total Term will need re-evaluation. An Arena Investor Advisor ensures that your financial plan stays aligned with your current needs and future goals.

4. Risk Management: Understanding and managing risks associated with investments, market fluctuations, and personal life changes are crucial. Your advisor helps you navigate these risks, ensuring that they minimally impact your Total Term.

5. Educational Support: The concepts of net worth, annual spending, and their relation to financial independence can be complex. Arena Investor Advisors are dedicated to educating you about these principles, empowering you with the knowledge to make confident financial decisions.

All In All

Total Term is a powerful metric for assessing how well-prepared you are to maintain your current lifestyle without additional income. It is particularly useful for retirement planning but is equally important for understanding your overall financial health. With the guidance of an Arena Investor Advisor, you can optimize your Total Term, ensuring financial security and peace of mind for the future. This strategic approach not only safeguards your immediate financial needs but also sets a solid foundation for achieving long-term financial independence and success.

Built for The One in the Arena

Arena Investor is on a mission not only to help with financial planning, and investment management, but also with education. Keep reading, watching, following, and sharing great Arena Investor content. And as always if you want professional advice, we are glad to be your teammate – along a financial journey you can actually enjoy.

You’re the Hero.
    We’re the Guide.