Investment Review – January 2019

January 18, 2019 Investment Review

  1. The month of December saw declines across U.S. stocks with the S&P 500 -9.0%, -8.5% for the Dow Jones Industrial Average, and -9.4% on the Nasdaq. Equities saw the largest annual decline during the bull market of the past decade, posting a -4.4% total return on the S&P 500 in 2018, while closing the year at 2506. Fears of a continued trade war, a further rise in interest rates, and a slowing global and U.S. economy provided the backdrop for this challenging month.

  2. The Price to Earnings multiple on the S&P 500 contracted from 20.5X to 16.5X during the 3rd quarter, the 14th largest decline over the past 92 years. This has happened 20 times during the same time frame; 15 of those periods saw a recuperation during the following year. Three of the years which failed to recover, were during the 1930’s following the Great Depression.


  3. Early indications show a positive holiday sales season. MasterCard Spending Pulse, which tracks consumer spending tendencies, saw the best growth in purchases over the past six years, growing at 5.1%, and over $850 billion dollars.

Key Investment Statistics January 2019

Sources: Bloomberg LLC, FactSet, U.S. Department of Labor

Disclosure: This commentary reflects the opinions of Welch & Forbes based on information that we believe to be reliable. It is intended for informational purposes only, and not to suggest any specific performance or results, nor should it be considered investment, financial, tax or other professional advice. It is not an offer or solicitation.


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