September 2024 Newsletter
The dominance of mega cap technology stocks has started to show signs of abating in the first half of the year. The market has broadened out, focusing on interest rates, inflation and economic activity at the year’s half way point. City National Rochdale (CNR) among our other strategists still expects corporate profit growth to be between 9% and 12% in 2024 and 8% and 12% next year. Important upcoming economic data on inflation, retail sales, and housing will be watched closely. Their advice, “Be prepared for additional bouts of volatility through the remainder of 2024. We (CNR) do not recommend reducing portfolio equity allocations…. We maintain our focus on high quality, reasonably valued U.S. companies with durable franchises and strong management.”
https://www.cnr.com/insights/market-perspectives/august-2024.html
Market Monitor
Goldman Sachs reports odds of recession at just 20% (up from 15%) because:
1) The rise in unemployment appears to be supply-driven.
2) GDP growth remains firm.
3) The Fed has significant easing capabilities.
Source: GS GIR and GS Asset Management. As of August 22, 2024.
How’s income? Strategists anticipate a reduction in interest rates. This will be beneficial for fixed income. If it’s time for more income, reach out for discussion soon. Consider Guided Income Solutions, an income system or specialty fixed income portfolios for a small tweak.
Our reminder: Our investment partners navigate on our behalf.
Food inflation – Yup! It’s more expensive at the grocery store even for discriminating adults. The reasons are never as simple as people would like to make it.
- Global supply and demand is still severely disrupted with Ukraine’s war.
- Crop disruption by weather/climate change.
- Worker incomes have risen with new minimum wage.
- Corporate dominance of processing creates efficiencies (chart above). Dominance also drives profits.
Names you recognize: Cargill, Monsanto, Bayer, John Deere. Their costs trickle down into consumer product prices.
News You Can Use
Issues of Longevity! More adults live their lives as singles. More families are spread across the country and beyond. More people age without a “deep bench” of dependable assistance for financial matters. We occasionally need help with daily living money management (bill paying) and trustworthy, local POA designation. We are in conversation with Lifespan for our clients with these unique needs. Reach out if you want to explore these options. We are glad to support this conversation with this good Rochester resource.
Website and online brochures: https://www.lifespan-roch.org/financial
There’s still more fun to be had!
World Class Adventure – Buffalo!! The Albright Knox Gundlach Art Museum, the 6th oldest art museum in N America, is world class. It’s featured in Time Magazine (8.5.24) as one of The World’s Greatest Places. Make a quick trip down the thruway to see the extraordinary Gundlach building addition and jazzy art throughout the updated complex. Have lunch or snack in the chic cafes. Peruse the cool shops. Cross the street to visit the Burchfield-Penney Art Center for more high-quality art. Take the arty kids in your world for a full day of expanding experiences. Lucky us!