Financial Market Analysis: Q1 2017

Our Q1 financial market analysis finds the stock market having charged through the 20,000 mark on the Dow Jones Industrial Average in January and eventually making it past 21,000 in late February. This move has continued to raise valuations of the overall stock market. Currently, the Shiller PE ratio (one measurement of stock valuations), is recording the third-highest valuation in US history. Only two times in US stock market history have stocks been this “expensive” – 1929 and 2000. Investors are looking ahead at the Trump Administration’s potential new tax plan, which should keep stocks slowly moving forward in 2017. With interest rates on the rise, it does not appear to be a year that will be overly robust for equity or bond market returns. The US economy does not appear to be heading to a recession, and emerging market economies look to be picking up economic growth. Indie Asset Partners expects a muted summer in stocks, and the Dow Jones Industrial Average should generally trade in the 20,300-21,500 range. Our firm plans to continue our focus on using alternative forms of investing within our clients’ overall portfolio strategies.