August 26, 2024
Current Market Trends
Interest rates have always been a major influence on voters. In recent weeks, politics and the economy have taken center-stage. The Fed has indicated possible interest rate cuts before the end of the year as we draw closer to the election. We’ve also witnessed a significant jump in the precious metals markets and a drop in semiconductor stocks.
If you look at the precious metals markets, silver and gold have both achieved new lifetime high prices in recent weeks. To break it down a bit, in a typical market year, when stock markets rallied, gold prices declined; When stock markets have fallen, gold prices have risen. Why the anomaly this year?
Donald Trump announced, “Taiwan has a lot to be worried about, regarding China.” He further suggested, “Taiwan should be paying us directly for protection…”, which thwarts a generation-long support for Taiwan against Chinese aggression. The semiconductor stocks, Taiwan being the global leader in semiconductor production, tanked on July 17, 2024, the morning after those comments were made. The only semiconductor stock to gain was Intel, the USA based producer of chips. Coincidence?
If we are greeted with a GOP administration in November, it would warrant a review of personal financial plans and market perspectives. This situation is no different from prior election years, however, these ever-changing market trends further justify the need for even greater vigilance when reviewing our investments and financial plan.
The best thing you can do? Stay strong. Remain disciplined and wait out the market-turning trends until there is a new definition of “market conditions” before making any significant changes to your portfolio. If you are seeking professional guidance, schedule time with a BCU Wealth Advisor to configure a plan that works best for your financial goals.
Good luck!
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