Market update: New year, new market outlook?

This week in the markets

  • The US stock market concluded 2018 with its worst yearly loss since 2008.
  • Back-to-back down years are very rare for the stock market, which could mean new hope for 2019.
  • Jobless claims stay near a 49-year low, easing some investor concerns over economic and labor market slowdowns.

2018 was a rough ride for most major markets

Not every year is a good year, and 2018 was a rough one for the stock market — many major market indexes experienced their worst yearly performances since the financial crisis of 2008. For the year, the Dow Jones Industrial Average (DJIA) was down 5.6%, the Standard & Poor’s 500 Index (S&P 500) dropped 6.2%, and the Nasdaq also fell 3.9%.

Fears over rate hikes by the Federal Reserve, which tend to push borrowing rates up for consumers, and concerns over ongoing trade negotiations between the US and China have helped push markets down in 2018. That being said, how should investors like you react during these turbulent times? By staying in it to win it!

MoneyLion investors should continue to consider maintaining a diversified portfolio and focusing on their long-term goals. A market without some volatility would be unnatural — like an ocean without waves — so let’s keep navigating these waters together! Take a look at these insights to guide you into 2019.

Hope for 2019: Back-to-back yearly declines are rare

What does 2019 have in store for the markets? No one knows for sure, but back-to-back drops are very rare for the S&P 500. In fact, the last time the S&P 500 was down for two or more consecutive years on a total return basis (including interest, capital gains, dividends, and distributions) was back in 2000 to 2003. There have only been four occasions since 1929 when the S&P 500 declined two or more years in a row. So let’s cheers to what we hope will be a prosperous New Year! 🥂

Jobless claims stay near a 49-year low

The number of Americans filing applications for unemployment benefits is near a 49-year low, which could help ease some investor concerns about a slowdown in the labor market and economy. The labor market is currently viewed as being near or at full employment. The US labor market has a direct impact on the economy. As workers have more bargaining power and are easily able to switch to higher paying jobs, employers tend to increase wages. These increased wages often translate into increased spending by consumers. Mo’ money, mo’ economic growth!

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