Registered Investment Advisor
95 Broadhollow Road, Suite 102
Melville, NY 11747
 (631) 923-2485
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Investment Newsletter - Q3 2024


Greetings! The dog days of summer are now fully upon us! Waiting for us at the end of the summer “tunnel”, so to speak, is the Presidential election. While the Presidential election may be worrisome for many people, one thing that has remained true in this ever-changing political landscape is that the market remains politically agnostic. The data has shown that markets, over the long run, will continue to rise no matter who is in office.



Speaking of the market, it was a very similar story to last quarter with some small twists. After a small “pull back” in April the “Magnificent 7” again drove the returns for the S&P 500 as that index had another solid quarter. After a strong Q1, small cap stocks did not continue their momentum and posted a negative Q2. Despite the small cap set back signs that the market is continuing to broaden beyond the “Magnificent 7” persist. commodities and emerging markets posted strong, positive quarters while the bond market was slightly positive for the quarter (although it remains slightly negative overall for the year).The “talk” from the pundits remains mixed on whether we are in for a soft landing or a recession (although most are in agreement in predicting a single, small, rate cut near September) which, while concerning, should not cause anyone to panic. Short-term turbulence and volatility are an unfortunate reality of investing but the data on investing over the long term is clear and overwhelmingly positive. 


We give you a deeper insight into our thoughts on the past quarter and an outlook for the current quarter and year further below. If you would like, we also have a link to the Q3 2024 Global Market Outlook by Russell Investments (click here - (please note, after clicking, you may then need to click the link at the bottom of that page)).



In this issue of our Investment Newsletter:


  • Our investment topic this issue is: "Do Dividend Payers Outperform"


  • Our second investment topic for this issue is: "Economic and Market Forecasts: What Are They Worth?"



  • Recent articles where Landmark Wealth Management was quoted in the press


  • An overview of recent market activity, along with Our Perspective...


  • A recap of the performance of major market indices from the past quarter


  • Upcoming Economic Calendar


You will find past investment articles, by clicking the Articles tab above, or directly on our website, found under Periodicals. 


If there is a topic of interest you would like to see covered in the future, please reply back to this email to let us know, or click here. Likewise, if you have any questions on this or anything else, feel free to reply back.

Investment Topic


"Do Dividend Payers Outperform?"


For our investment topic, "Do Dividend Payers Outperform?" we give our thoughts and suggestions. To learn more, please click here.


Please note - this investment topic, as well as past investment topics, can be found on our website under the Articles tab, or you can click here.

Investment Topic


"Economic and Market Forecasts: What are They Worth?"


For our investment topic, "Economic and Market Forecasts: What are They Worth?" we give our overview on the subject. To learn more, please click here.


Please note - this investment topic, as well as past investment topics, can be found on our website under the Articles tab, or you can click here.

Recent articles where Landmark Wealth Management was quoted in the press


The past few years, Landmark Wealth Management has been quoted in the press for various articles. We have decided to start sharing these when they happen. If curious about past times we were mentioned, you can see it on our website under Articles > In The Press, or simply click here.

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From an article on the website MarketWatch: My mom is 92 and we invested $200K at a credit union. I told them we could tie it up for 1 year, max. Now it’s tied up for 7 years and they won’t talk to us. What’s my move?". To access this article, please click here.

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From an article on the website GoBankingRates, "8 Services Wealthy Retirees Spend Money On That Poor and Middle Class People Don't". To access this article, pleasclick here.

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From an article that was on the website MarketWatch: "I’m 47, will get a $5,000-per-month pension, only owe $180,000 on my home and have $419,000 in a savings account. Should I get a pro to help me?". To access this article, please click here.

Our Perspective on Recent Market News and Activity
Our synopsis of the past quarter, a look ahead, and putting it all in perspective:

As spring turned into summer, we found more of the same for the stock market, the tech giants and growth stocks of the “Magnificent 7” once again surged and had a strong quarter. While some signs of broadening can be seen in areas like emerging markets or even the bond market, large, tech, growth stocks have continued to dominate. That said, a full investment portfolio is more than just these stocks and considering many other portions of the market have ranged from flat to down, investment returns have not been very close to the S&P 500. Hopefully the market will broaden later in the year, as it did in Q4 2023, but that remains to be seen.

 

Investors are still dealing with higher interest rates, and inflation, while not worsening, remains stubborn. Estimates for how many rate cuts we will see this year have now dropped from 3 to 1 with that 1 rate cut predicted to be small and near the end of the year. The bond market has shown signs of life, posting a very slightly positive Q2, but the returns for the overall year remain flat to negative. The Federal Reserve is still attempting to aim for a soft landing but with inflation continuing to hold steady above their 2% target they have very little “wiggle room” with which to intervene.

 

Looking at equities, the S&P 500 had another strong quarter, and closed up by nearly 4%. While it was a good quarter it wasn’t as roaring as Q1, and the fact remains that the index is being dominated by the whims of the “Magnificent 7”. Troublingly for those who hoped the market would definitively broaden beyond those top tech names, Small and Mid-Cap stocks performed poorly in Q2, both posting losses of roughly 4%. Other than the S&P 500 the other top sectors were Communication Services, Consumer Defensive and Utilities. The lagging sectors were Energy, Industrials, and Basic Materials, which posted a loss of nearly 6% in Q2. All in all, Q2 was a much narrower quarter than Q1 in terms of what drove the equities market and it remains to be seen when that trend will change.

 

The bond market did turn positive in Q2, the Bloomberg US Bond Aggregate Index was up nearly .1% for the quarter, which while not mind blowing was a welcome sight after they began the year slightly in the negative, had a mostly flat to slightly positive 2023, and had their worst year since Beethoven and Salieri were topping the charts in the late 1700's, in 2022. This slightly positive turn comes despite continued high levels of debt and inflation continuing to remain around 3% (although it slightly decreased from Q1), above the target 2% the Fed is attempting to navigate down to. The yields on treasuries all jumped substantially throughout Q2. The 10 year achieved a high of nearly 4.7% in April before falling to around the 4.3% mark it ended the quarter with and now sits. That said, the 10-year treasury yield still remains below the 2 year treasury yield, which closed Q2 in the 4.6-4.7% range. This inversion of the yield curve has been a constant since it first began in 2022 and, even though there was some positivity in the bond market as consensus opinions believe a rate cut is coming in September this inversion seems to be here to stay at least until then.

 

Looking forward to Q3 it seems as though there are two main concerns on the minds of investors. The first concern we have heard echoed by many clients and friends alike has to do with the Presidential election. Although we know we are not capable of assuaging fears anyone might have over which candidate will eventually “triumph” over the other, we can reiterate that, for the most part, the market is agnostic to whomever comes out on top. There will likely be short-term volatility no matter who wins but in the long run the data is strong that markets will continue to rise.

 

The second concern we’ve heard concerns asset allocation. Over the past year and a half no investment category has come close to the S&P 500, much less the 7 stocks in the “Magnificent 7”. Bonds have ranged from terrible to flat in that same time period and other asset classes have fluctuated but have not come close to reaching the highs of the S&P 500. A look at hundreds of years of investment history indicates that this should not be able to continue; however, many prognosticators have been saying this for months only to be left flattened by the large cap, tech, growth runaway train.

 

Although it may not be flashy if you are looking for a reason to remain diversified and stick to your investment plan one might do best to recall the tech bubble bursting in 1999-2000. The rhetoric and market trends we are seeing today are very reminiscent of what occurred before that bubble burst (and the AI to Dot Com technology comparison seems particularly apt). One statistic recently published that is reminiscent of that environment comes from Apollo Global Management’s chief economist Torsten Sløk who pointed out that the top 10 companies in the S&P 500 now account for 35% of its market value and only 23% of its earnings. One cannot say how long this tech growth environment will continue, but one thing we do know is that remaining diversified is the best way to protect against the market moving in the opposite direction like it did after the tech bubble burst. The two images below help to illustrate how concentrated the top holdings are in the S&P 500. One shows the recent state of concentration, and the other shows how it compares to the past 30+ years.

Above chart is from Advisorpedia, 7/1/2024

If it has been a while since we last sat down and went over your own personal numbers, we encourage you to make an appointment and meet with us for a review. Hopefully you have a happy Fourth of July Weekend and a wonderful rest of the summer. 



Please remember that all investments carry some level of risk, including the potential loss of principal invested. They do not typically grow at an even rate of return and may experience negative growth. As with any type of portfolio structuring, attempting to reduce risk and increase return could, at certain times, unintentionally reduce returns.

Major Market Indices

Below is the Q2 '24 price return performance of some of the major indices:

On the Investment Horizon

Upcoming Key Dates on the Economic Calendar 


  • First Friday of each month: Unemployment report for the prior month, released at 8:30AM.



  • Thursday, July 4th - Independence Day: US Markets closed.
  • Thursday, July 25th at 8:30AM - GDP, 2nd quarter (Advance Estimate).
  • Tuesday, July 30 - Wednesday, July 31: The Federal Open Market Committee (FOMC) meets, and releases their announcement on Wednesday at 2PM.
  • Wednesday, July 31 - Federal Open Market Committee (FOMC) releases minutes of previous meeting at 2PM.


  • Thursday, August 29 at 8:30AM - GDP, 2nd quarter (second estimate).


  • Monday, September 2nd - Labor Day: US Markets Closed
  • Tuesday, September 17 - Wednesday, September 18: The Federal Open Market Committee (FOMC) meets, and releases their announcement on Wednesday at 2PM.
  • Thursday, September 26th at 8:30 AM - GDP, 2nd quarter (third estimate).


For our clients - You should have received your statement directly from our account custodian, Charles Schwab& Co. If you have not, please let us know so that we may investigate the matter. Please review your statement carefully and let us know if you have any questions or comments.

Also, as a reminder, our office (not so new any longer as we have been here over two years), has a nice sized conference room to use for our meetings and updates. If you do not feel comfortable coming into our office or if it is inconvenient, we recommend that we set up a Zoom or teleconference call to update your planning numbers, especially if it has been more than a year since we have last done so. Please feel free to reach out.

For everyone - If you desire an appointment, have any questions on any of this material, or any other financial subjects may relate to your own financial circumstance, please reach out to us at the contact information below:
 
 
Sincerely,
 
Brian Cohen, CCO; email: brian@landmarkwealthmgmt.com; phone: 631-923-2487
Joe Favorito, CFP®; email: jfavorito@landmarkwealthmgmt.com; phone: 631-930-5336
Jim Millington, CFP®; email: jim@landmarkwealthmgmt.com; phone: 631-470-0765
Aaron Belletsky; email: aaron@landmarkwealthmgmt.com; phone: 631-982-8049

Direct office email: info@landmarkwealthmgmt.com 
Direct phone: 631-923-2485


This communication is from Landmark Wealth Management, LLC, a Securities and Exchange Commission Registered Investment Advisory firm. The information in this email is not intended as tax or legal advice, and it may not be relied on for the purpose of avoiding any federal tax penalties. You are encouraged to seek tax, legal, or investment advice from an independent professional / financial advisor. The content is derived from sources believed to be accurate. Neither the information presented nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. Information and use of materials contained in this email, including text and attachments, is confidential and is for the use of the intended recipient(s) only. If received in error, you are hereby notified that any dissemination, distribution, or copying of this communication, or any of its contents, is strictly prohibited. If you have received this communication in error, please reply to the sender and delete the original message and any copy of it from your systems. Be also advised that email communications are not secure. All e-mail sent to or from this address will be recorded by the Landmark Wealth Management, LLC email system and is subject to archival, monitoring, and inspection pursuant to securities regulations. Please direct any matters regarding this policy to info@landmarkwealthmgmt.com.
 Landmark Wealth Management, LLC
95 Broadhollow Road, Suite 102
Melville, NY 11747
 (631) 923-2485