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The Best of What They Said and I Read Week Ending 10/27/2019

Short excerpts from articles I found interesting.  I may not agree with the author and the following material is not intended as investment advice

Barron’s –October 26, 2019 – The S&P 500 Closed Out the Week Strong – but Not Strong Enough -  Lawrence C. Strauss

  •  “…The S&P 500 index flirted with an all-time closing high on Friday, but came up just short. It closed at 3022.55, up 1.2% for the week…Still, it was the third straight week of gains for the index....“The market is starting to sniff out that global growth is likely stabilizing,” says Keith Lerner, chief market strategist at SunTrust Advisory Services, following concerns of a slowdown…The Dow Jones Industrial Average rose 0.7% for the week, to close at 26958.06, 1.5% below its record close set on July 15…The Russell 2000, which tracks small-cap shares, finished the week at 1558.7, with a 1.5% gain.”

  • “…The Federal Reserve is expected to cut short-term interest rates again this coming week, the latest in a series of rate reductions around the world. The Fed has already cut short-term rates twice this year, first in July and then in September, each time by a quarter of a percentage point…The Nasdaq Composite Index, a bellwether for technology stocks, rose 1.9% during the week, closing at 8243.12—its fourth consecutive week finishing in positive territory.”

U.S. Global Investors - Investor Alert – October 25, 2019 – Frank Holmes 

  • “…A lot of the news coming out of China right now is negative. Its economy is slowing. Tariffs are hurting trade. The Hong Kong protests are causing geopolitical pressure. It’s enough to make an investor run and hide.  Which would be a mistake…The First Trust Chindia ETF, which invests in companies in both China and India, is up more than 20 percent for the 12-month period through October 25. That’s enough to beat the S&P 500 over the same period.   Or consider British stocks. You might think that Brexit uncertainty has made investing in the U.K. a nightmare. And yet the opposite seems to be the case—the iShares MSCI United Kingdom ETF is up close to 10 percent for the 12-month period.”

  • “…Twitter was the worst performing stock for the week, falling 22.29 percent…Amazon reported third-quarter earnings on Thursday, missing Wall Street estimates on profit — sending the stock tumbling as much as 8.62 percent after the release…Walmart has launched an in-home delivery service where customers can have items delivered directly to their fridge when they're not at home. Walmart workers gain access to customers' homes using smart-lock technology controlled from a mobile phone.”

  • “…Bloomberg Businessweek reports that California will become the first state to require almost all new homes to draw some power from the sun starting in 2020. Solar already makes up about one-seventh of electricity supply in the state and leads the U.S. in home solar panels.”

The Kiplinger Letter – October 25, 2019 

  • “…NAFTA remains in effect, as long as Trump doesn’t pull the plug on it…unlikely as the 2020 race looms. But the suspense will continue to hurt the U.S. economy. One estimate shows trade policy uncertainty lowering U.S. capital spending by about $100 billion. Global trade grew only 1% in 2019’s first half, the slowest pace since 2012. Trade volumes in goods dropped 1.4% in June…the worst decline in a decade.” 

  • “China’s economy continues to cool off. GDP growth in the third quarter edged down to 6%, versus 6.2% in the second quarter. The current pace of growth is the slowest in nearly three decades. Still, even with the slowdown this year, China’s economy will expand 6.2% in 2019, meeting Beijing’s target of 6% to 6.5%. But there are some notable bright spots amid China’s mixed economic data.  Industrial production and home sales rose, while retail sales held up in Sept.   Infrastructure investment is recovering. Banks are also getting more leeway to lend.” 

  • “South Korea’s continued woes signal further trouble for the global economy.  Seoul serves as a barometer for global trade because it relies so heavily on exports. The country is poised for an 11th consecutive monthly drop in exports.  Key culprits: China’s economic slowdown and flagging demand for tech products.  Exports from the world’s 12th-largest economy are down 20% from this time last year. Semiconductor sales, the largest share of South Korean exports, are down 29%. GDP growth of 1.9% is expected in 2019, the slowest pace since the Great Recession. Seoul isn’t the only major exporter having a rough time. Japan’s exports have declined for 10 straight months, and shrinking exports are hurting Germany.” 

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