What’s in store for the rest of 2017?
With the first half of the year behind us, we wanted to stop and take stock of how the markets and the economy have fared through the first two quarters of 2017.
So far this year, the U.S. economy has continued to strengthen with solid earnings reports. Most companies have reported strong metrics and show opportunity for growth and upward movement. In addition to earnings, the Federal Reserve under Chairman Yellen has done a good job of raising interest rates at a measured pace, and the Fed plans to begin reducing its balance sheet if markets continue to do well, lowering U.S. debt levels.
With the administration’s inability to pass new health care legislation, it calls into question whether Trump can fulfil other campaign promises, like lower taxes and increased infrastructure spending. If these legislation items don’t come to fruition, there could be some market pullback over the next 90 days.
The economy is running on all cylinders, but with nine years of virtually uninterrupted growth, the U.S. economy is due for a true correction in the stock market between now and year-end. With this in mind, it’s still important to stay the course and stay invested according to your financial plan. Timing the market for a correction is a dangerous game and it’s impossible to predict how things will unfold. Stick to long-term plans and don’t let a potential routine correction spook you out of the market.