Financial News and Portfolio Management Discussion through January 31st

US Stocks sank over the week on disappointing earnings and concerns about economic growth. The S&P 500 fell 2.8% and the Dow sank 2.9% for the week. For January, the S&P 500 dropped 3.1% and the Dow was down 3.7% for the worst month since last January. Internationally, Japan rose 0.9%, but Europe was down 0.9% for the week. While down for the week, Europe rallied 7.2% for the month and Japan edged up 1.2%. The 10 year Treasury yield continues to plummet falling to 1.68%, its lowest level since early May 2013. Oil rebounded slightly as some US production was cut to $48.24 a barrel.

Leftist Greek party Syriza won about half the seats in Greek’s parliament. The party is against the austerity measures that the country has had to endure over the last five years setting up a showdown between the country and the rest of the eurozone.

Russia’s credit rating was downgraded to junk status by S&P moving it below investment grade in the first time in over a decade Russia’s central bank also cut its key interest rate by two percentage points. The moves sent the ruble lower.

Photo courtesy of investorplace.com

At the conclusion of the Fed’s most recent meeting it announced it still planned on keeping rates near zero until the middle of the year or later. They viewed the economy as expanding at a “solid pace,” but still said that it could be “patient” in raising rates.

Eurozone inflation declined still further with prices falling 0.6% in January compared to a year earlier. Factoring out volatile food and energy prices the inflation rate was up 0.6% from a year earlier.

Fourth quarter GDP rose 2.6% well below expectations bringing the total year growth rate to 2.4%. US consumer spending rose strongly over the quarter, but corporations saw a decrease in exports, as the dollar rose, and cut spending.

Microsoft, Pfizer, Dupont, Caterpillar, Alibaba, Google disappointed investors with their quarterly report, while, AT&T, Apple, Samsung, Facebook, Blackstone, Deutsche Bank, Ford, Amazon, and Chevron topped or met expectations.

Reposted from the Raffa Wealth Management Blog.

All the news you need to stay informed about what’s currently driving the market – courtesy of Raffa Wealth Management, LLC