Quarterly Real U.S. GDP Growth

The U.S. economy is coming off of its tax cut–induced bump. Estimates of 2019 GDP are coming down, as indicated in the chart above. U.S. steady-state growth should settle in at about 2.5% next year. Headwinds include weakening global growth, rising interest rates, and reduced liquidity via Federal Reserve policy.

U.S. & World Equity Indexes; 10/24/18; YTD Return
S&P 500; 2,740; 2.50%
Dow Jones Industrials; 25,191; 1.90%
Nasdaq Composite; 7,437; 7.70%
Shanghai Composite (China); 2,594; −21.50%
S&P BSE Sensex (India); 33,847; -0.60%
Nikkei Stock Avg (Japan); 22,010; -3.30%
CAC 40 (France); 4,967; -6.50%
DAX (Germany); 11,274; −12.70%
FTSE 100 (U.K.); 6,955; -9.50%
Selected Interest Rates; 10/24/18; 9/30/18
15-Year Mortgage; 4.26%; 4.11%
30-Year Mortgage; 4.85%; 4.65%
5-Year Treasury Bond; 3.01%; 2.96%
10-Year Treasury Bond; 3.17%; 3.08%
30-Year Treasury Bond; 3.37%; 3.21%
Key Economic Statistics; Most Recent; Prior Month
National
Producer Price Index; 0.20%; -0.00%
Consumer Price Index; 0.10%; 0.20%
Unemployment Rate; 3.70%; 3.90%
ISM Manufacturing Index; 59.80; 61.30
ISM Services Index; 61.50; 58.50

ISM Manufacturing PMI

The industrial side of the economy continues to show robust growth, albeit slower than seen in the summer. According to the Institute of Supply Management, the “impact of the trade tension hasn’t been a significant weight—yet.”

Equity Market Statistics; Most Recent; Prior Month
Dow Jones Industrials; 10/24/18; 9/30/18
Dividend Yield; 2.19%; 2.21%
Price/Earnings (12 Mth Trailing); 23.30; 23.00
Price/Earnings (Projected); 16.93; 16.70
S&P 500 Index; 10/24/18; 9/30/18
Dividend Yield; 1.89%; 1.89%
Price/Earnings (12 Mth Trailing); 22.19; 22.88
Price/Earnings (Projected); 16.96; 17.33

The information herein was obtained from various sources believed to be accurate; however, Forté Capital does not guarantee its accuracy or completeness. This report was prepared for general information purposes only. Neither the information nor any opinion expressed constitutes an offer to buy or sell any securities, options, or futures contracts. Forté Capital’s Proprietary Market Risk Barometer is a summary of 30 indicators and is copyrighted by Forté Capital LLC. For further information, visit www.fortecapital.com, send a message to [email protected], or call 866-586-8100 and ask for David W. Henion, CPA, or Larry H. Rabinowitz, CPA/PFS.