So far, 2019 has been a good year for the U.S. stock market, despite media headlines that would have you believe the sky was falling.
The Dow Jones Industrial Average DJIA, +1.25% has risen 13%, the S&P 500 SPX, +1.27% has climbed 16.8% and the Nasdaq Composite Index COMP, +1.48% has jumped 20% this year through the close of the stock market Aug. 29. Those figures exclude dividends.
Looking ahead, investors have plenty of concerns:
• The trade conflict between the U.S. and China has settled in for the long haul. Still, investors’ moods brightened Thursday after a spokesman for China’s Ministry of Commerce said the country wouldn’t immediately respond to the latest round of tariffs announced by President Trump, according to a Bloomberg report.
• U.K. Prime Minister Boris Johnson is making parliamentary maneuvers ahead of the Oct. 30 Brexit deadline. Great Britain’s economy shrank during the second quarter for the first time since 2012.
• U.S. economic growth figures for the second quarter were adjusted lower, although strong consumer spending appeared to be a silver lining.
Meanwhile, the trend of money flowing from yield-seeking foreign investors into U.S. stocks seems likely to continue. The 2.03% weighted aggregate dividend yield for the S&P 500 (according to FactSet) looks attractive in a world with $16 trillion in negative-yielding debt securities. That dividend yield for the S&P 500 also exceeds the 1.97% yield on 30-year U.S. Treasury bonds TMUBMUSD30Y, +1.05%.
Dow winners and losers
Here’s year-to-date price movements for all 30 components of the Dow Jones Industrial Average through the close Aug. 29, except for the “new” Dow Inc. DOW, +1.32%, which has fallen 14.9% since it began trading separately from the temporarily combined