Market Update: Third Quarter 2019
Over the last three months, global markets had mixed results. US large company stocks, emerging markets stocks, and global bonds all enjoyed modest gains. Smaller companies, developed international stocks, and commodities all saw a small decline.
The Federal Reserve cut rates twice in the third quarter, which reinforced the willingness to be accommodating with central banking policy. The negative implication here is that needs help, because it is slowing down. The positive view is that our policymakers are willing to do what is needed to keep the financial system healthy. Consumers in the USA are still showing very positive signs for the domestic economy. Housing, employment, and retail sales are all very healthy. Consumer spending makes up about two-thirds of the US economy.
Brexit is on a crash course for Halloween. Even with a complete breakdown of diplomacy in the UK government, the odds of a "hard Brexit" are still relatively low. The highest probability at this time is that they "kick the can down the road" again, delaying the deadline into 2020.
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