Curious about what's happening in the stock market? Every month, the alooola® team summarizes the key takeaways in a quick, easy-to-understand article!
What Do I Need to Know?
•2022 was a year to forget for many investors.
•Traditionally safe U.S. Treasuries lost 17%, alternative investments like bitcoin lost roughly 60%, and the S&P 500 fell 20%.
•Many investors hope 2023 will be better since the S&P 500 has only dropped in consecutive years four times since 1928.
•That being said, when consecutive down years have occurred, drops in the second year have always been deeper than in the first, with an average decline of 24%.
U.S. VS The World
•The S&P 500 has outperformed international stocks by 52% over the last five years and 160% over the last decade.
•In the past year, however, the S&P 500 has started underperforming most of the rest of the world.
•For example, Europe's STOXX 600 index has gained 17% since the end of the third quarter in 2022, versus only an 11% gain for the U.S. S&P 500.*
•This is partially because the hard-hit tech sector amounts to 26% of the S&P 500, while tech is only about 7% of the STOXX 600.
Cocktail Party Facts
•If Congress does not act soon, the US may hit its debt ceiling. The last time this happened in 2011, the S&P 500 dropped 6.6%.
•The national debt has grown substantially and is 120% of GDP today compared to 106% in 2019.
Student Loan Debt
•Beginning in 2024, the Secure 2.0 Act will allow employers to provide their employees with matches based on student loan payments.
•This means that student loan payments can be treated as elective deferrals or employee 401(k) contributions and, therefore, applicable to a company’s matching policies.
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Disclosure: alooola® is a branded investment advisory service provided by Glen Eagle Advisors, LLC, an SEC Registered Investment Adviser. The Glen Eagle Advisors brochure provides an explanation of the service and its fee structure. Material presented is for informational purposes only, and is not meant to be advice to any individual. Talk with alooola® to see how this information may apply to you. Consider your current financial situation, tolerance for risk, and investment objectives before you invest funds in securities through alooola®. For a more complete explanation of the alooola® service, please visit www.alooola.com. This email includes factual data based on articles published by Reuters, Wall Street Journal, Barrons Magazine, Apollo Chief Economist Research, BofA Global Research, MFS Research "By the Numbers", and Bloomberg.