As we come upon the end of another year, we want to leave you with this thought: The US economy is actually doing well. Despite the emotions and fears of some investors, we’ve encouraged our clients and friends to stay the course and stick to the fundamentals.
Though we’ve seen some scary ups and downs with the Dow and S&P, it looks like they’ll end the year on a good note. Year-to-date the Dow has been up a little over 6% and the S&P 500 is over 10%.
As we explore the top sectors in the market, the sector that we’ve seen the most decline in is the Energy sector. If you’re holding energy stocks (and nothing else), you likely saw some declines in your investment. These stocks have fallen 14% since the middle of 2014. However, a good trend that we are seeing is the US finally achieving more independence for energy resources that may play out well in 2015.
The sector that has been performing well is Retail. Can you believe that earlier this year we were paying nearly a dollar more in gas? Consumers are now noticing how much less they are spending on gas, and many analysts recognize that this is producing a healthier economy. Retail sales have been higher than expected – a good sign that consumers are spending more. The surge in spending has been partly attributed to the direct correlation between prices at the pump and consumers taking that extra cash to spend in retail stores like Walmart and Target.
Another positive – in 2014, we’ve seen corporate profits continue to rise at an accelerated race. Yet another plus as we head into a new year.
And finally, labor force participation has gone up – meaning more people are entering into the workforce.
All of these factors are producing a positive outlook for the start of 2015.
The final thought we’ll leave you with is an emerging trend that will change how consumers approach investing with a financial advisor. A few weeks ago our Chief Investment Strategist, Wes Moss, published an article in the AJC about robo-advisors as a new trend that we’ll hear a lot more about in 2015. In short, this is a relatively new concept where an algorithm is used to help you select investments. There’s a continuum of these firms emerging that are following this trends. In short, robo-advising tends to replace a traditional person-to-person interaction. Instead of sitting with an advisor, a robo-advisory firm facilitates all your planning through your computer or mobile device. Expect to hear more about this trend in 2015.
What are your thoughts about emerging trends and the market for 2015? Post your thoughts below.