Will the Fed Taper in 2021?
August 23, 2021
Stocks turned lower last week amid the increasing probability of a Fed tapering, mixed economic data, and growing concerns about the economic impact of the Delta variant.
The Dow Jones Industrial Average slumped 1.11%, while the Standard & Poor’s 500 lost 0.59%. The Nasdaq Composite index slipped 0.73%. The MSCI EAFE index, which tracks developed overseas stock markets, surrendered 2.94%. 1
After the Dow Industrials and S&P 500 index climbed to new record highs to begin the week, stocks pulled back amid weaker-than-expected retail sales, festering concerns about the Delta variant, and slowing growth in China.
The stock market retreat accelerated mid-week with the release of the FOMC (Federal Open Market Committee) meeting minutes, which signaled that Fed officials may be ready to begin reducing its monthly bond purchases before the end of the year. Stocks managed to stabilize on Friday, paring some of the week’s losses. Consumer staples, health care, real estate, and utilities were the top-performing groups. 2
Taper by Year End?
Two weeks ago, multiple regional Federal Reserve Bank presidents suggested that the economy was strong enough to justify tapering the Fed’s monthly bond purchases.
Last week, that chorus grew a bit louder with the release of minutes from July’s FOMC (Federal Open Market Committee) meeting. The precise timing was left undecided, with some officials believing it should begin before year-end, while others thought waiting until the start of the new year was the better choice. 3
This Week: Key Economic Data
Monday: Existing Home Sales. PMI (Purchasing Managers’ Index) Composite Flash.
Tuesday: New Home Sales.
Wednesday: Durable Goods Orders.
Thursday: Jobless Claims. Gross Domestic Product (GDP).
Friday: Consumer Sentiment.
Source: Econoday, August 20, 2021
The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.
This Week: Companies Reporting Earnings
Monday: JD.com, Inc. (JD), Palo Alto Networks, Inc. (PANW).
Tuesday: Best Buy Co. (BBY), Intuit, Inc. (INTU).
Wednesday: Salesforce.com (CRM), Ulta Beauty, Inc. (ULTA), Autodesk, Inc. (ADSK).
Thursday: Marvell Technology, Inc. (MRVL), Workday, Inc. (WDAY), Dollar Tree (DLTR), Dell Technologies (DELL), VMware, Inc. (VMW), Peloton Interactive, Inc. (PTON).
Source: Zacks, August 20, 2021
Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.
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VIX CALM IN THE FACE OF RECENT SELLING
“The HCM-BuyLine® is positive, and any pullback should be bought. Covid has put some pressure on the market, along with the markets being a bit overbought." 4
This communication is issued by Howard Capital Management, Inc. It is for informational purposes and is not an official confirmation of terms. It is not guaranteed as to accuracy, nor is it a complete statement of the financial products or markets referred to. Opinions expressed are subject to change without notice.
Start a New Business Off on the Right Foot
Starting a new business? There are some important tax tips to know to set yourself up for success. Here are some tips that the IRS shares for new business owners:
Choose the right business structure: The form of business determines which income tax return a business taxpayer needs to file. The most common business structures are a sole proprietorship, a partnership, a corporation, an S corporation, and an LLC.
Apply for an Employer Identification Number (EIN): An EIN is used to identify a business. Most businesses need an EIN. 5
* 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 professional.
Summer Skincare Tips
The first, and most important, tip is to always wear sunscreen, even if you're not spending a lot of time out in the sun. Some skincare products, including makeup, have sunscreen built-in, but you should consider using a moisturizer with at least SPF 30 for an extra level of protection.
Another good summer skincare tip is to lighten up your skincare routine. In the summer, you're likely going to be sweating, swimming, and spending time outside so you might not need as much makeup or products as you do in the winter. 6
Russian Tomato Salad Bruschetta
Time: 1 hr 15 mins
- 1 clove garlic, crushed
- 2 tablespoons olive oil
- 2 tablespoons plain yogurt
- ¼ cup sour cream, or to taste
- ½ cup thinly sliced sweet onion
- 2 cups thinly sliced tomatoes
- salt and freshly ground black pepper to taste
- 1 pinch cayenne pepper, or to taste
- 8 thick slices French bread
- 1 tablespoon sliced fresh chives
- Mix garlic and olive oil in a small bowl and let sit for about 1 hour, or until needed.
- Mix the yogurt and sour cream together in a bowl until combined. Add the onions and tomatoes and toss until well coated. Season with salt, freshly ground black pepper, and cayenne. Wrap in plastic wrap and chill in a refrigerator until needed.
- Preheat a charcoal grill until coals are white and ashy.
- Grill bread over hot charcoal, rotating as needed, until both sides are nicely toasted and slightly charred.
- Brush grilled bread with the garlic olive oil and use a slotted spoon to transfer the tomato salad over top of each. Excess dressing can be spooned over if desired. Garnish with chives and serve immediately. 7
Footnotes and Sources
1. The Wall Street Journal, August 20, 2021
2. ALPS Portfolio Solutions, August 20, 2021
3. Reuters.com, August 19, 2021
4. Howardcm.com, August 18, 2021
5. IRS.gov, September 19, 2020
6. Allure.com, July 22, 2019
Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost.
The forecasts or forward-looking statements are based on assumptions, may not materialize, and are subject to revision without notice.
This content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. Please consult legal or tax professionals for specific information regarding your individual situation. This material was developed and produced by FMG Suite to provide information on a topic that may be of interest. FMG is not affiliated with the named representative, financial professional, Registered Investment Advisor, Broker-Dealer, nor state- or SEC-registered investment advisory firm. The opinions expressed and material provided are for general information, and they should not be considered a solicitation for the purchase or sale of any security.
Copyright 2021 FMG Suite.