Providing Context and Calm Leading into the Weekend
When we checked in with you on Monday, we had a feeling this was going to be a rocky week. And, now that we’ve lived through it, we’re checking back in to give you a sense of where things stand and what we’re watching as we head into next week.
First, we get a respite for two days. The news will continue to unfold, but the markets will be still. We recommend using the time to rest, recover, and reset in that stillness.
Through yesterday’s close, the stocks in your portfolio have taken a 3% hit as a result of this week’s volatility, mostly driven by the implications from the conflict in Iran.* As expected, oil prices have spiked upward given the closure of the Strait of Hormuz, and today’s news of a softening labor market in the US added fuel to investors’ concerns. Given the way markets moved today, we can expect that the stocks in your portfolio will close the week down between 4% and 5%.
Here’s the upshot: inclusive of this week’s downswing, the stocks in your portfolio are likely still going to be up between 4% and 5% year-to-date.* As challenging as this week has been, recall that less than a year ago your portfolio took hits of 5% on back-to-back days in response to the Liberation Day Tariffs (more than twice as rough as the fallout from this week’s news), only to come roaring back over the next eleven months (it’s here that we’ll point out that your portfolio of stocks is up by more than 25% over the past 12 months, inclusive of last spring’s volatility and this week’s slide).* We point this out only to note that what’s happening in this moment is short-term; we can’t know what will happen in the coming days, weeks, or months, but we do know your portfolio is built to be resilient, as is your financial plan.
We will continue to watch the headlines and hope for a resolution as soon as possible. And we, along with the rest of the world, will be tuned in to the Fed’s decision on interest rates when they meet in a couple weeks. At present, they’re contending with forces pushing and pulling them in opposite directions, so while interest rates may hold steady, Chairman Powell’s comments after the meeting may be instructive regarding the path ahead.
We’ll see how markets react as new information is digested (as ever – that’s what they’re supposed to do). And we’re here if you’d like to digest any of this with us in real time. In the meantime, we wish you a peaceful and restful weekend.
Best,
The YeskeBuie Team