Weekly Market Update
June 26, 2017
Presented By:  Todd Day, Portfolio Manager


Things You Don't See in a Downtrend

Last week, I said the NASDAQ was taking on water, well, on Monday; the NASDAQ was up 1.4%, not quiet the leaking I had spoken of.  Did it get its mojo back?  Time will tell...but it did close up on the week.

The Dow and S&P finished positive but only slightly.

Here are some factoids for the major averages:
  • The DOW Jones Industrial Average (DOW) hit another record new high on Monday!  It was the first time that the DOW broke 21,500 in its more than 100 year history!
  • Seven of the 13 days the market was open in June so far have resulted in new highs!
  • The DOW daily closing stock market average has risen 17% since the election on November 8th.
  • Since the Inauguration on January 20th the DOW is up 9%.
  • The US Stock Market gained $2 trillion in wealth since Trump was elected!
  • The S&P 500 also broke $20 Trillion for the first time in its history.
  • The S&P closed Monday at its 24th record high of the year.

These are not things you see in a downtrend or bear market, for the record...


It's official - the US 'retail apocalypse' has moved north as Sears Canada (and some of its subsidiaries) have applied to Ontario Superior Court of Justice for protection under the companies' Creditors Arrangement Act (CCAA), in order to continue to restructure its business.

Sales at Sears Canada have fallen sharply since it was spun off from its equally-troubled US-based parent in 2012; the slump coincides with a broader shift in consumer preferences away from brick and mortar retailers and toward 
e-commerce.  The markets were not surprised.


Since the start of 2017, economic data has been mixed.  On one hand, the unemployment rate has fallen and consumer confidence remains at elevated levels.  On the other hand, however, demand side data (light vehicle sales, housing starts and inventory growth) has disappointed.

It is worth thinking about the recent weakness in the context of the long-term drivers of economic growth.  Real GDP is driven largely by the supply side (i.e., payroll growth) and while Q2 GDP is looking more like Q1's weak point, it is mostly being driven by the demand side.  This has many economists saying that even though we are experiencing a slight slowdown, this should not be as severe as many expect because we are seeing steady employment growth and they expect that imports, exports and government spending to see a bounce back in the second half of the year. 

We will be watching the data to see if this plays out.


European stocks continue to sell off as the slide in oil prices has investors hitting the pause button, but fundamentally, the EU is seeing positive tones from many European companies to the much improving economic backdrop.
Most Asian indices were higher on the week. 


This week, I think the market's focus will be on the role out of a potential vote on the new healthcare bill and this has got healthcare, pharmaceuticals, and biotech names in perking up in the last week.

Oil prices continue to fall (supply, supply, supply) and this bears watching.

U.S. Treasury yields have now fallen to levels not seen since before the election - this also bears watching, as the bond market is sending some mixed signals about the economy.

We will be watching a busy economic calendar to close out June and the first half of the year.  We will get the final revision to Q1 GDP, durable goods orders, consumer confidence and personal income and spending.  We will also hear from a number of FED speakers, including FED Chair Yellen.

Due to the 4th of July holiday, there will not be a weekly market update or newsletter next week.


Please join me the following week for a special half time market report video, as I review the twists and turns in the stock market for the first half of the year. 

"Attempt the impossible in order to improve 
your work."

- Bette Davis
Spiced Pear and Berry Crumble

A buttery, spicy treat!
        • 1 cup all-purpose flour
        • 2/3 cup old-fashioned oats
        • 1/2 cup light brown sugar
        • 1/2 cup walnuts, chopped
        • 1/4 teaspoon salt, plus one pinch
        • 6 tablespoons cold butter, divided, plus 4 tablespoons
        • 1/2 teaspoon ground cinnamon
        • 1/4 teaspoon ground allspice
        • 2 pounds ripe, peeled pears, cored and chopped
        • 1/2 cup granulated sugar
        • 2 cups frozen mixed berries (such as blueberries, raspberries, and blackberries)
        • 3 tablespoons cornstarch
        • 1/4 cup amaretto or almond liqueur

1.  Preheat oven to 375°F.


2.  Combine flour, oats, brown sugar, walnuts, and 1/4 teaspoon salt in 

medium bowl.


3.  Rub 6 tablespoons butter into mixture with fingers.


4.  Squeeze crumb mixture to form large clumps, and place in the freezer.


5.   Heat remaining 4 tablespoons butter on medium in oven-safe, 10-inch skillet for 6 minutes or until butter browns and becomes fragrant, swirling often.


6.  Add cinnamon and allspice to butter.


7.  Cook for 1 minute, stirring frequently.


8.  Add pears, granulated sugar, and pinch of salt, and stir for 5 minutes.


9.  Remove from heat, and mix in berries, cornstarch, and amaretto.


10. Take crumb from freezer and sprinkle over the pear-berry mixture 

until fully covered.


11.  Bake for 25 minutes or until topping browns and pears are tender.

12.Can serve warm or at room temperature.

Recipe adapted from Good Housekeeping
Know Who Can Represent You Before the IRS
The tax preparer you choose to help you file taxes can have different representation or "practice" rights. And these rights affect how they can represent you before the IRS. As you manage your tax details within your financial life, remember these tips.
Two Types of Representation Rights

*   Unlimited: This category enables your tax preparer to represent you before the IRS on any tax item. The credentialed tax professional can be an Enrolled Agent, Certified Public Account (CPA), or attorney.


*   Limited: This category means that only the person who prepared and signed your tax return can represent you before the IRS. But he or she cannot represent you on appeals or collection matters. The tax preparer can represent you in front of revenue agents, customer service representatives, and similar IRS employees.

As you manage your taxes each year, be sure to familiarize yourself with the tax preparer's representation rights.

Other details apply, and you can find more information on the IRS website.
 *This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax advisor.

Tip courtesy of IRS.gov
Eliminate Your Lag
Experienced golfers use power and finesse to keep the ball in play. By developing the correct downswing sequence for managing their lag, they add distance to their shot. They hold the angle between their lead arm and club shaft for as long as possible in their downswing. Done incorrectly and you can shank the ball, top it, and hit shots to your right. The goal is to achieve lag while turning the club over through impact.
To achieve a proper downswing sequence - that generates correct force by winding out into the club - follow these tips:

1. Use a 6- or 7-iron: 

Without using the ball, first set up to the ground. You'll need to bend your arms and place the shaft outside of your right-upper arm (for righties). To land the correct position, you may have to lightly release your right hand.


2. Turn your shoulders: 

Do so at 90 degrees and keep the club shaft   against your right arm. This should be a move similar to making a back swing.

 3.  Try a downswing:  
Swing and test how long the shaft remains touching      your right arm; doing so should even your hands with your right leg.
4. Make your delayed release: The delayed release should whip your    club-head through impact, naturally turning over your forearms and club.



Tip courtesy of GolfTips Magazine
Understand High Blood Pressure

The symptoms of high blood pressure are difficult to detect. Casually known as the "silent killer," many people with the condition are unaware that anything is wrong with their health. By familiarizing yourself with some potential traits of high blood pressure, you'll better prepare yourself to proactively care for your health.
Eyes develop blood spots
When your blood pressure goes untreated, you may damage your optic nerve. This isn't a direct result from high blood pressure; however, developing blood spots in your eyes (called subconjunctival hemorrhage) is more common in people with elevated blood pressure levels.
Face flushes
Our faces can redden (when blood vessels dilate) from a variety of triggers, such as exercise and emotional stress. People with high blood pressure may experience higher levels of facial flushing.
Sudden dizziness occurs
Some people with high blood pressure may experience dizziness as a side effect from their condition. But, similar to other symptoms, elevated blood pressure levels are not the direct cause of dizziness. Instead, sudden dizziness can be a warning sign of stroke - and a leading cause of strokes is high blood pressure.
Tip courtesy of American Heart Association

Keep Weeds in Control With These Home Remedies
Maintaining your lawn requires also controlling the weeds that can easily take over your green. A host of products exist on the market to help you control weeds, but these commonly have chemicals that can pollute our drinking-, ground-, and surface waters. Fortunately, you can keep your weeds in control with simple home remedies that are also easy on nature.
Tip 1: Drench with boiling water.
No plants like to have boiling water poured on them. This simple trick can help you control your weeds without additional chemicals. Simply boil water, and pour onto the plants you wish to kill. Just be careful to not burn yourself or plants you want to keep in the process.
Tip 2: Apply white vinegar to leaves.
Weeds don't like vinegar, so you can control their growth by spraying it directly onto the leaves of the plants you want to kill. To do so, fill a spray bottle directly with white vinegar and douse onto the leaves. Be sure to avoid contaminating the soil.
Tip 3: Use table salt.
Plants don't handle sodium well when it makes contact with their leaves. To use salt as an effective herbicide, dissolve 1 part salt in 8 parts hot water. Then, add a touch of dish soap to the mixture, thus creating an effective herbicide. Pour into a spray bottle, and apply directly onto the leaves.

Tip courtesy of Care2.com
Share the Wealth of Knowledge!

Please share this market update with family, friends, or colleagues. If you would like us to add them to our list, simply click on the "Forward email" link below. We love being introduced!

Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.


Diversification does not guarantee profit nor is it guaranteed to protect assets

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.


The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the NASDAQ. The DJIA was invented by Charles Dow back in 1896.


The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.


The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.


The Housing Market Index (HMI) is a weighted average of separate diffusion indices based on a monthly survey of NAHB members designed to take the pulse of the single-family housing market. Each resulting index is then seasonally adjusted and weighted to produce the HMI.


The Pending Home Sales Index, a leading indicator of housing activity,  measures housing contract activity, and is based on signed real estate contracts for existing single-family homes, condos and co-ops.  The PHSI looks at the monthly relationship between existing-home sale contracts and transaction closings over the last four years. The results are weighted to produce the index.


The Chicago Board Options Exchange Market Volatility Index (VIX) is a weighted measure of the implied S&P 500 volatility. VIX is quoted in percentage points and translates, roughly, to the expected movement in the S&P 500 index over the upcoming 30-day period, which is then annualized.


The BLS Consumer Price Indexes (CPI) produces monthly data on changes in the prices paid by urban consumers for a representative basket of goods and services. Survey responses are seasonally adjusted and weighted to produce a composite index.


The Conference Board Leading Economic Index (LEI) is a composite economic index formed by averages of several individual leading economic indicators, which are weighted to produce the complete index.


Google Finance is the source for any reference to the performance of an index between two specific periods.


Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.


Past performance does not guarantee future results.


You cannot invest directly in an index.


Consult your financial professional before making any investment decision.

Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.


These are the views of Horizon Financial Services, LLC, and should not be construed as investment advice. Neither Horizon Financial Services, LLC nor its Investment Advisor Representatives or Associates gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information. 

John Brais, Owner & Founder
Investment Advisor Representative
Certified Retirement Financial Advisor
Horizon Financial Services, LLC
3880 Vest Mill Road, Suite 100
Winston Salem, NC 27103
(336) 659-7060


Investment advisory services are offered through Horizon Financial Services, LLC, a North Carolina State Registered Investment Advisor.  Insurance products are offered through 

New Horizon Financial Services, Inc.  Horizon Financial Services, LLC and New Horizon Financial Services Inc. are affiliated companies.