Current Headlines and Market Volatility

Here are the recent financial and economic headlines: 

  • Strong U.S. jobs report was released on Friday with unemployment falling to the lowest level in fifty years.   
  • The Federal Reserve is holding on moving the Federal Fund interest rate.   
  • U.S. Inflation rate is lower than economist expected and trending around two percent.  
  • U.S. economy has been very good with GDP reported to be growing at a robust 3.2 percent during the first quarter of calendar year 2019.   
  • The economy has experienced consistent growth for more than ten year despite periods of short term market volatility, sell-offs and negative headlines.   
  • POTUS tweeted late Sunday threatening to raise tariffs on Chinese imports. The tweet has riled and caused a sell-off of U.S. and global equity markets during the first full week of May. 
  • U.S. financial media reporting that the Chinese trade officials are considering postponing travel to the U.S. to continue trade negotiation talks.
  • U.S. – China trade negotiations continue with most economists and financial experts assuming that a trade deal will be successfully negotiated since many believe a bilateral trade deal is in the best interest of both parties. 

With the recent headlines, what actions should a long term investor take in view of the headlines, current short term market volatility and sell-off?   

A long term investor should take no short term actions other than to follow their long term financial plan and maybe decrease the volume on the financial media/entertainment networks. If in doubt, they should call their financial adviser for emotional support.

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