An alarm on my phone just went off, saying our area was now in a tornado warning, and I am instructing my colleagues to take shelter.
An unexpected storm perfectly sums up how investing feels this year.
Investors have now turned their calendars and put the April market behind them. This was a wild month in the market. In April, U.S. stocks experienced record trading volume, historic intra-day price swings and widespread technical damage as a wave of uncertainty fueled a sharp equity market sell-off. Even so, stocks held tough. At the close of the market on April 29, the S&P 500 was only 1.5% below where it started in April, after having clawed back a month-to-date decline that was as bad as negative 11.5% at one point in April.
April’s historical trendsIf stocks end April with a negative monthly return, it will be the second consecutive negative April in a row and the third in the last four years. This could forecast a tough market for the rest of this year, given that tariff relief is still temporary and a policy decision has yet to be delivered.
Unfortunately, marketwise April showers probably won’t bring us May flowers. Until things are settled on the tariff front, U.S. stocks might continue this up-and-down pattern for the near future with fits of volatility mixed in. In fact, historically when the month of April closes in the red, May is generally flat.
Conclusion
The current investing backdrop remains challenging and could continue to be so through the next few months. Good advisors are monitoring tariff news, economic data, earnings, the bond market and various technical indicators to look for stock opportunities. There are opportunities out there, but it takes some work to find them.
Thankfully, the tornadoes went just north and west of us. We took shelter when we needed to and got back to work when the storm passed. This is a good plan for investors, too: Take shelter when you need to, but don’t give up hope because opportunities are just ahead.
Have a blessed week.
Fervent Wealth Management is a financial management and services entity in Springfield, Mo. Securities and advisory services offered through LPL Financial, a registered investment advisor, Member FINRA/SIPC.
Opinions are for general information only and not intended as specific advice or recommendations. All performance cited is historical and is no guarantee of future results. All indices are unmanaged and can’t be invested in directly.
The economic forecast outlined in this material may not develop as predicted and there can be no guarantee that strategies promoted will be successful.
Visit www.ferventwm.com for more information.