Dow logs best trading day in 2017, booming past 24,000

December 01, 2017

Keywords: Asset Management

The stock market entered 2017 with quite the bang, as the Dow Jones Industrial Average was on an unprecedented roll at the time. With a month remaining and stock prices continuing to turn heads, it's sure looking like 2017 will go out with a boom, perhaps best evidenced by what took place on Wall Street during November's swan song.

The Dow soared to yet another record-setting height Nov. 30, hitting and surpassing 24,000 for the first time ever, up more than 331 points from the previous trading day. The blue chip index has experienced a remarkable run over virtually the entirety of 2017, setting at least 60 all-time highs within the calendar year. In fact, in 2017 alone, there have been five thousand-point growth spurts for the DJIA, The Wall Street Journal pointed out.

Trading expert Paul Brigandi told the news publication that the Dow has been the recipient of a treasure trove of encouraging developments, both in the economic and legislative sphere.

"Between tax reform and the economy strengthening, the fundamentals look good," Brigandi explained. "Markets are expecting the tax bill [to pass] and are optimistic about what that means for the economy."

How investors would tinker with taxes
The full Senate is set to vote soon on a bill that by all accounts would be a major overhaul of the U.S. tax code, which - among other things - reduces the number of tax brackets for individuals and lowers the corporate tax rate to 20 percent from its previous 35 percent. Investors have different takes on what they think about the Tax Cuts and Jobs Act. According to polling done by the American Association of Individual Investors, the most common responses regarding what investors would do with taxes if they were in charge was removing deductions on mortgage interest, swapping out a progressive tax for a flat tax and reducing taxes for businesses.

Speaking of which, analysts indicate banks would be the biggest beneficiaries of a corporate tax cut, already paying considerable amounts in taxes to the federal government, the Journal reported.

The Dow wasn't the only index that soared as November came to a close. The Standard & Poor's 500 also ratcheted higher, adding more than 21 points to 2,647.58, up more than 20 percent for the month. The Nasdaq also gained ground, logging a near 50-point uptick to 6,873.97.

The major mover, however, was the Dow Jones, logging it's biggest single trading day gain since Nov. 7 and one-day percentage increase since March 1, the Journal noted. Since the election, the DJIA is 32 percent higher and up a remarkable 271 percent since the height of the recession, or specifically March 9, 2009. At the time, the index's point total was 6,547.09.

Most investors believe consumers are in good shape
With consumer buying representing the lion's share of the U.S. economy, the stock market's performance - along with other indicators - has investors believing the typical consumer is doing much better today than they were this time last year. In a separate AAII survey, which asked respondents how they believed the average consumer was faring financially, 57 percent thought they were doing better today than in 2016, pointing to stock prices, low inflation and economic expansion as their reasoning. Just 15 percent thought consumers were worse off now than this time last year

There's no denying the stock market's impressive performance. However, the only way for the boom to pay dividends is through high quality asset management. At Miles Capital, we put our clients' best interests first, providing guidance they can use to assiduously and judiciously round out their investment portfolios.

Disclosures

This material is for informational purposes only and is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer, or solicitation to buy or sell any securities or to adopt any investment strategy. The opinions expresses may change as subsequent conditions vary. The information herein is based on sources which Miles Capital believes to be reliable, but is not guaranteed to be accurate or complete.

Past performance is not a guarantee of future results. There is no guarantee that any forecasts made will come to pass. There is potential for profit or loss with any investment. Index performance is shown for illustrative purposes only — you cannot invest directly in an index. No part of this material may be reproduced in any form, or referred to in any publication without the express written permission of Miles Capital, Inc.