Home > NewsRelease > Hello Spring and Economic Recovery
Text
Hello Spring and Economic Recovery
From:
Greg Womack -- Oklahoma Financial Advisor Greg Womack -- Oklahoma Financial Advisor
For Immediate Release:
Dateline: Oklahoma City, OK
Thursday, May 6, 2021

 

 


It’s Spring andeconomic recovery is in the air.

Last week, the Bureauof Economic Analysis reported the U.S. economy grew at a 6.4 percentannualized rate for the first three months of 2021. While that’s goodnews for companies and workers, asset managers are checking their expectations.

The stock marketreflects what investors think may happen in the future. During the past year,major U.S. stock indices moved higher as investors anticipated vaccines andeconomic recovery, reported Patti Domm of CNBC. Since its March 2020low, the Standard & Poor’s 500 Index has gained 88 percent.

Amidst strong signsof recovery in the United States, some asset managers are positioning for“inflation and tapering,” according to a source cited by Naomi Rovnick of FinancialTimes. “Investors have topped up their cash holdings at the fastestrate since March 2020 as debate intensifies over whether stock markets willcontinue rallying now the U.S. economic recovery from the pandemic is firmlyunder way.”

Investors werefeeling cautious last week, but there were no signs of tapering, which occurswhen the Federal Reserve begins to buy fewer bonds. On Wednesday, the Fed leftits supportive policies in place.

When the Fed beginsto change course and rates move higher, equity market valuations may adjust.“The main worry for stocks is that higher bond yields translate into lowerequity valuations. Higher yields reduce the current value of future profits andtherefore can reduce earnings multiples,” reported Jacob Sonenshine of Barron’s.

Profits were strongduring the first quarter of 2021. U.S. companies continued to reportexceptional earnings last week. With 60 percent of firms in the Standard &Poor’s 500 Index reporting, the blended earnings growth rate was 45.8 percent.More than 8 of 10 companies have reported better than expected earnings,reported John Butters of FactSet.

Major U.S. stockindices finished the week flat to down. Rates on 10-year Treasuries edgedhigher.

Best regards, 

Womack Investment Advisers, Inc.

 

WOMACK INVESTMENT ADVISERS, INC.

Oklahoma / Main Office: 1366 E. 15th Street - Edmond, OK  73013
California Office: 4660 La Jolla Village Dr., Ste. 100 - San Diego, CA 92122
Phone (405) 340-1717 - Toll Free (877) 340-1717 

 Website:  www.womackadvisers.com

Womack Investment Advisers, Inc. (WIA) is a registered investment adviser whose principal office is located in Oklahoma. Womack Investment Advisers, Inc. is also registered in the State of California, the State of Illinois, the State of Indiana, and the State of Texas. WIA only transacts business in sates where it is properly registered, or excluded, or exempted from registration requirements.


  Dogs may be some of the world’s most effective disease detectives. In January, before COVID-19 was known to have arrived on our shores, NPR wrote about the dogs’ ability to smell disease. The host of Medical Monday interviewed Maria Goodavage, author of Doctor Dogs: How Our Best Friends Are Becoming Our Best Medicine , who said:   “With ovarian cancer, there's not much great testing for early detection. I heard about these dogs at the University of Pennsylvania Veterinary Working Dog Center that are able to smell ovarian cancer. They're able to detect it as early as stage one. We're not even talking tumors here. They're able to detect ovarian cancer in one drop of plasma from a woman with ovarian cancer.” Doctor dogs also are being trained to detect the novel coronavirus. Reuters reported, “A study recently found dogs can identify infected individuals with 85 percent to 100 percent accuracy and rule out infection with 92 percent to 99 percent accuracy.” Airp
  David Kostin, the Goldman Sachs chief U.S. equity strategist, wrote in a note to clients “The U.S. election is just 81 days away and represents a significant risk to our year-end forecast.” Analysts often mention the uncertainty surrounding presidential elections in the United States, and this year is sure to be no exception. However, John Stoltzfus, CIO of Oppenheimer Asset Management told clients, “Embrace the uncertainty.”   His research showed that historically, elections haven’t done much to prevent stocks from going up regardless of which political party prevails. Furthermore, Stoltzfus writes, “Uncertainty usually comes with opportunity and risk—two considerations essential in making investments.”     A study by Deutsche Bank showed that in Presidential election years in which the contest is thought to be “close”, stocks generally go up until a month or so before the election, then pull back a bit, and then resume their uptrend from around the election through the end of the
    Warren Buffett during an interview with CNBC’s Becky Quick on February 24, 2020. It turned out to be another year during which the billionaire investor shied away from game-changing acquisitions in a pricey market even after a sudden market cash and as his company holds a massive cash balance. Gerald Miller | CNBC   Warren Buffett’s Berkshire Hathaway made some big purchases in 2020, but the biggest Buffett buy speaks to the big challenge the company will continue to face: there was nothing it could find at a better price than its own shares. Berkshire bought back more than $18 billion in its own shares last year, through October, almost twice as much as Buffett spent on his next biggest acquisition, the $10 billion natural gas assets transaction with Dominion Energy, which including the debt acquired, was the largest acquisition since 2016. Taken at his word — which he has earned — that he won’t do a share repurchase just to prop up the stock, the big buyback was a
News Media Interview Contact
Name: Greg Womack, CFP
Title: President
Group: Womack Investment Advisers
Dateline: Edmond, OK United States
Direct Phone: 405-340-1717
Jump To Greg Womack -- Oklahoma Financial Advisor Jump To Greg Womack -- Oklahoma Financial Advisor
Contact Click to Contact
Other experts on these topics