Presented by Mark Gallagher 

General Market News
• The rates market saw some volatility after the long weekend. The 10-year Treasury opened at 1.53 percent early Tuesday morning but quickly dropped to 1.46 percent. The 2-year Treasury opened at 1.49 percent, and the 30-year Treasury is back below 2 percent at 1.94 percent. The markets will be anticipating a rate decision from the Federal Reserve (Fed) again this month, as it meets on September 18.
• Global equities rallied last week as trade tensions waned slightly. The week began with President Trump claiming that China called the U.S. trade team and stated that it wanted to restart trade discussions. This call was not confirmed by Chinese officials but was followed by a comment from Chinese Vice Premier Liu that China is willing to resolve the trade dispute with calm negotiations. As of Thursday, the next round of in-person trade talks was set to take place this month, although no date has been set.
• The calming of the trade dispute saw a risk-on trade, as the sectors that have sold off (industrials, communication services, and financials) were among the top three performing sectors on the week. The worst performers were the bond proxies in consumer staples, REITs, and utilities.
• We kicked off the week with Monday’s release of the July durable goods orders report, which showed 2.1 percent growth in orders. This result was better than expectations for 1.2 percent growth; however, much of this outperformance was due to an increase in volatile aircraft orders. The core durable goods figure, which strips out transportation orders, declined by 0.4 percent, against expectations for no growth. Core durable goods orders are seen as a proxy for business confidence for the future of the economy. So, this decline in the core figure is disappointing but not entirely surprising, given the ongoing uncertainty from increasing trade tensions.
• On Tuesday, the Conference Board Consumer Confidence Index was released. The index declined slightly, from 135.7 in July to 135.1 in August, beating expectations for a larger decline to 129. This result was driven by increased optimism about the current economy, as the present situation portion of the index rose to highs last seen in 2000. Expectations for the future declined slightly but still remain high compared with the past few years.
• On Friday, July’s personal income and consumer spending reports showed that spending grew by 0.6 percent in July, against expectations for 0.5 percent growth. This result is in line with the strong retail sales we saw during the month. Income growth was disappointing, coming in at 0.1 percent versus the 0.3 percent growth that was expected. Both income and spending have shown consistent growth this year, so this miss in income is nothing to be concerned about for the time being.
• We finished the week with the second and final release of the University of Michigan consumer sentiment survey. This survey fell from 92.4 midmonth to 89.8 at month-end, even though economists had expected the index to increase slightly. The escalation of the China-U.S. trade war and continued market volatility likely played a part in the decline in confidence. Although both major consumer confidence surveys declined during the month, the good news is that consumers have shown impressive spending growth through most of the year. Hopefully, these declines in confidence will have little effect on August’s consumer spending data.

Source: Bloomberg

Source: Morningstar Direct

What to Look Forward To
The week started with Tuesday’s release of the Institute for Supply Management (ISM) Manufacturing index. It showed an unexpected decline from 51.2 in July to 49.1 in August. This is a diffusion index, where values above 50 represent expansion and values below 50 represent contraction. August’s reading is the lowest reading for the index since January 2016, and it marks the first time the manufacturing sector has experienced a contraction since August 2016. It also marks the fifth straight month of decline for the index, as the slowdown in global trade and the uncertainty created by the ongoing U.S.-China trade war have negatively affected manufacturers.

Speaking of trade, Wednesday will see the release of July’s international trade report. It is expected to show the trade deficit shrinking from $55.2 billion in June to $54.3 billion in July. Previously released trade reports showed growth in goods exports rising by more than expected during the month, as well as a decline in goods imports, which led to a narrowing of the goods deficit. This combination of rising exports and declining imports for goods is expected to lead to a narrowed deficit in overall trade.

On Thursday, we’ll receive the ISM Nonmanufacturing index for August. Economists expect to see increased confidence for the service sector of the economy, with the index set to increase from 53.7 in July to 54 in August. This survey fell unexpectedly in July to a three-year low, so a rebound would help dispel concerns about lowered business confidence.

Finally, we’ll finish the week with Friday’s release of the August employment report. Economists expect 168,000 new jobs during the month, which is slightly better than the 164,000 we saw in July. Unemployment is expected to remain unchanged at 3.7 percent. Despite the expected growth in August, job growth remains well below the roughly 225,000 per month rate we averaged in 2018. This will be an important area of the economy to monitor going forward, especially if we continue to see further weakness in employment growth while the Fed considers further interest rate cuts.

Disclosures: Certain sections of this commentary contain forward-looking statements that are based on our reasonable expectations, estimates, projections, and assumptions. Forward-looking statements are not guarantees of future performance and involve certain risks and uncertainties, which are difficult to predict. All indices are unmanaged and are not available for direct investment by the public. Past performance is not indicative of future results. The S&P 500 is based on the average performance of the 500 industrial stocks monitored by Standard & Poor’s. The Nasdaq Composite Index measures the performance of all issues listed in the Nasdaq Stock Market, except for rights, warrants, units, and convertible debentures. The Dow Jones Industrial Average is computed by summing the prices of the stocks of 30 large companies and then dividing that total by an adjusted value, one which has been adjusted over the years to account for the effects of stock splits on the prices of the 30 companies. Dividends are reinvested to reflect the actual performance of the underlying securities. The MSCI EAFE Index is a float-adjusted market capitalization index designed to measure developed market equity performance, excluding the U.S. and Canada. The MSCI Emerging Markets Index is a market capitalization-weighted index composed of companies representative of the market structure of 26 emerging market countries in Europe, Latin America, and the Pacific Basin. The Russell 2000® Index measures the performance of the 2,000 smallest companies in the Russell 3000® Index. The Bloomberg Barclays US Aggregate Bond Index is an unmanaged market value-weighted performance benchmark for investment-grade fixed-rate debt issues, including government, corporate, asset-backed, and mortgage-backed securities with maturities of at least one year. The U.S. Treasury Index is based on the auctions of U.S. Treasury bills, or on the U.S. Treasury’s daily yield curve. The Bloomberg Barclays US Mortgage Backed Securities (MBS) Index is an unmanaged market value-weighted index of 15- and 30-year fixed-rate securities backed by mortgage pools of the Government National Mortgage Association (GNMA), Federal National Mortgage Association (Fannie Mae), and the Federal Home Loan Mortgage Corporation (FHLMC), and balloon mortgages with fixed-rate coupons. The Bloomberg Barclays US Municipal Index includes investment-grade, tax-exempt, and fixed-rate bonds with long-term maturities (greater than 2 years) selected from issues larger than $50 million.

Mark Gallagher is a financial advisor located at Gallagher Financial Services at 2586 East 7th Ave. Suite #304, North Saint Paul, MN 55109. He offers securities and advisory services as an Investment Adviser Representative of Commonwealth Financial Network®, Member FINRA/SIPC, a Registered Investment Adviser. He can be reached at 651-774-8759 or at mark@markgallagher.com.

Authored by the Investment Research team at Commonwealth Financial Network.

© 2019 Commonwealth Financial Network ®

Presented by Mark Gallagher

General Market News
• The 10-year Treasury yield was as low as 1.47 percent late last week, before opening at 1.61 percent on Monday. The 30-year was below 2 percent for the first time ever. It opened at 2.11 percent on Monday, and the 2-year opened at 1.52 percent. Rates moved significantly lower, raising questions about the timing of the next recession. With yields close to historical lows and the Federal Reserve (Fed) just starting to lower rates, it is likely we will continue to see historically low yields across the curve.
• The S&P 500 fell by 2.9 percent on Wednesday, as investors flocked to safer fixed income assets. This reaction followed a negative gross domestic product print for the German economy for the second quarter (–0.1 percent) and the lowest factory output in China in 17 years. The index recovered in the second half of the week.
• Equity investors also sought out shelter last week in the traditional haven assets with bond proxy sectors, including consumer staples, utilities, and REITs. The top-performing sector, consumer staples, was supported by Walmart’s strong quarter-over-quarter online sales growth of 37 percent.
• Last week’s worst-performing sectors were financials, consumer discretionary, and energy. Wells Fargo and Citigroup were down 4.13 percent and 3.89 percent, respectively. Investors sold out of these positions following a yield curve inversion, which led to concerns over future net interest margins. The inversion earlier in the week came following growth concerns and led to a strong rally in longer-term bonds.
• On Tuesday, July’s Consumer Price Index data was released. It showed inflation of 0.3 percent for the month and 1.8 percent year-over-year. Higher gas prices combined with higher prices for key areas of the service sector were the major drivers of this growth. Despite the increase in July, consumer inflation still sits comfortably below the Fed’s 2 percent target.
• On Thursday, July’s retail sales data came in much better than expected. Sales grew by 0.7 percent during the month, against expectations for 0.3 percent growth. Once again, rising gas prices played a part in this beat. But the major driver for sales growth came from the nonstore sales category, which was boosted by the annual Amazon Prime Day sales event midmonth. This was a very encouraging report, as consumer spending is the major driver of overall economic growth. The strong result for July bodes well for third-quarter growth, as long as consumers continue to spend.
• On a more negative note, Thursday also saw the release of July’s industrial production report, which showed a 0.2 percent decline. This disappointing result was due in large part to a 0.4 percent drop in manufacturing output, where most major industries saw declines during the month. The slowdown in global trade has hurt demand for American goods abroad. Although the slowdown in production was disappointing, it is understandable given the current global trade landscape.
• The National Association of Home Builders Housing Market Index report for August was also released on Thursday. It showed an increase in home builder confidence, marking the second-straight month of increasing confidence. Prospective buyers ticked up to their highest level since October 2018, which could bode well for future home sales if mortgage rates remain low and draw in more would-be buyers.
• Despite the uptick in home builder confidence, construction data was mixed. Housing starts fell by 4 percent in July, against expectations for 0.2 percent growth. Multifamily apartment starts declined for the second-straight month, while single-family housing starts rose to their highest level since January. There may be hope for faster growth in housing starts going forward, as building permits rose by 8.4 percent during the month.
• On Friday, we finished the week on a sour note, with the University of Michigan consumer sentiment survey declining from 98.4 in July to 92.1 in August. Both the current conditions and future expectations indices dropped during the month, as stock market turbulence weighed heavily on consumer confidence, and uncertainty surrounding additional tariffs on Chinese goods spooked investors. Consumer spending is highly influenced by consumer confidence, so this will be a key economic indicator to keep an eye on going forward.

Source: Bloomberg

Source: Morningstar Direct

What to Look Forward To
Wednesday will see the release of July’s existing home sales data, which is set to show 2.5 percent month-over-month growth, following a 1.7 percent decline in June. Given low mortgage rates and home builder reports of additional foot traffic, a strong showing here would be a positive sign that prospective home buyers have not been scared away by rising home prices.

The minutes from the Fed’s July 31 meeting are also set to be released on Wednesday. This was a closely watched meeting, as the Fed voted to cut the federal funds rate for the first time in more than a decade, marking a shift toward a more supportive stance for the economy. Economists will be reading the minutes carefully to try to gauge the likelihood of future rate cuts.

Finally, we will close out the week with the release of July’s new home sales data on Friday. New home sales are forecast to decline by 0.2 percent during the month. Sales rose by 7 percent in June, so this projected decline is nothing to worry about—especially if we see growth in existing home sales, which make up a significantly larger portion of the housing market.

Disclosures: Certain sections of this commentary contain forward-looking statements that are based on our reasonable expectations, estimates, projections, and assumptions. Forward-looking statements are not guarantees of future performance and involve certain risks and uncertainties, which are difficult to predict. All indices are unmanaged and are not available for direct investment by the public. Past performance is not indicative of future results. The S&P 500 is based on the average performance of the 500 industrial stocks monitored by Standard & Poor’s. The Nasdaq Composite Index measures the performance of all issues listed in the Nasdaq Stock Market, except for rights, warrants, units, and convertible debentures. The Dow Jones Industrial Average is computed by summing the prices of the stocks of 30 large companies and then dividing that total by an adjusted value, one which has been adjusted over the years to account for the effects of stock splits on the prices of the 30 companies. Dividends are reinvested to reflect the actual performance of the underlying securities. The MSCI EAFE Index is a float-adjusted market capitalization index designed to measure developed market equity performance, excluding the U.S. and Canada. The MSCI Emerging Markets Index is a market capitalization-weighted index composed of companies representative of the market structure of 26 emerging market countries in Europe, Latin America, and the Pacific Basin. The Russell 2000® Index measures the performance of the 2,000 smallest companies in the Russell 3000® Index. The Bloomberg Barclays US Aggregate Bond Index is an unmanaged market value-weighted performance benchmark for investment-grade fixed-rate debt issues, including government, corporate, asset-backed, and mortgage-backed securities with maturities of at least one year. The U.S. Treasury Index is based on the auctions of U.S. Treasury bills, or on the U.S. Treasury’s daily yield curve. The Bloomberg Barclays US Mortgage Backed Securities (MBS) Index is an unmanaged market value-weighted index of 15- and 30-year fixed-rate securities backed by mortgage pools of the Government National Mortgage Association (GNMA), Federal National Mortgage Association (Fannie Mae), and the Federal Home Loan Mortgage Corporation (FHLMC), and balloon mortgages with fixed-rate coupons. The Bloomberg Barclays US Municipal Index includes investment-grade, tax-exempt, and fixed-rate bonds with long-term maturities (greater than 2 years) selected from issues larger than $50 million.

Mark Gallagher is a financial advisor located at Gallagher Financial Services at 2586 East 7th Ave. Suite #304, North Saint Paul, MN 55109. He offers securities and advisory services as an Investment Adviser Representative of Commonwealth Financial Network®, Member FINRA/SIPC, a Registered Investment Adviser. He can be reached at 651-774-8759 or at mark@markgallagher.com.

Authored by the Investment Research team at Commonwealth Financial Network.

© 2019 Commonwealth Financial Network ®

Presented by Mark Gallagher

General Market News
• The 10-year Treasury yield was as low as 1.47 percent late last week, before opening at 1.61 percent on Monday. The 30-year was below 2 percent for the first time ever. It opened at 2.11 percent on Monday, and the 2-year opened at 1.52 percent. Rates moved significantly lower, raising questions about the timing of the next recession. With yields close to historical lows and the Federal Reserve (Fed) just starting to lower rates, it is likely we will continue to see historically low yields across the curve.
• The S&P 500 fell by 2.9 percent on Wednesday, as investors flocked to safer fixed income assets. This reaction followed a negative gross domestic product print for the German economy for the second quarter (–0.1 percent) and the lowest factory output in China in 17 years. The index recovered in the second half of the week.
• Equity investors also sought out shelter last week in the traditional haven assets with bond proxy sectors, including consumer staples, utilities, and REITs. The top-performing sector, consumer staples, was supported by Walmart’s strong quarter-over-quarter online sales growth of 37 percent.
• Last week’s worst-performing sectors were financials, consumer discretionary, and energy. Wells Fargo and Citigroup were down 4.13 percent and 3.89 percent, respectively. Investors sold out of these positions following a yield curve inversion, which led to concerns over future net interest margins. The inversion earlier in the week came following growth concerns and led to a strong rally in longer-term bonds.
• On Tuesday, July’s Consumer Price Index data was released. It showed inflation of 0.3 percent for the month and 1.8 percent year-over-year. Higher gas prices combined with higher prices for key areas of the service sector were the major drivers of this growth. Despite the increase in July, consumer inflation still sits comfortably below the Fed’s 2 percent target.
• On Thursday, July’s retail sales data came in much better than expected. Sales grew by 0.7 percent during the month, against expectations for 0.3 percent growth. Once again, rising gas prices played a part in this beat. But the major driver for sales growth came from the nonstore sales category, which was boosted by the annual Amazon Prime Day sales event midmonth. This was a very encouraging report, as consumer spending is the major driver of overall economic growth. The strong result for July bodes well for third-quarter growth, as long as consumers continue to spend.
• On a more negative note, Thursday also saw the release of July’s industrial production report, which showed a 0.2 percent decline. This disappointing result was due in large part to a 0.4 percent drop in manufacturing output, where most major industries saw declines during the month. The slowdown in global trade has hurt demand for American goods abroad. Although the slowdown in production was disappointing, it is understandable given the current global trade landscape.
• The National Association of Home Builders Housing Market Index report for August was also released on Thursday. It showed an increase in home builder confidence, marking the second-straight month of increasing confidence. Prospective buyers ticked up to their highest level since October 2018, which could bode well for future home sales if mortgage rates remain low and draw in more would-be buyers.
• Despite the uptick in home builder confidence, construction data was mixed. Housing starts fell by 4 percent in July, against expectations for 0.2 percent growth. Multifamily apartment starts declined for the second-straight month, while single-family housing starts rose to their highest level since January. There may be hope for faster growth in housing starts going forward, as building permits rose by 8.4 percent during the month.
• On Friday, we finished the week on a sour note, with the University of Michigan consumer sentiment survey declining from 98.4 in July to 92.1 in August. Both the current conditions and future expectations indices dropped during the month, as stock market turbulence weighed heavily on consumer confidence, and uncertainty surrounding additional tariffs on Chinese goods spooked investors. Consumer spending is highly influenced by consumer confidence, so this will be a key economic indicator to keep an eye on going forward.

Source: Bloomberg

Source: Morningstar Direct

What to Look Forward To
Wednesday will see the release of July’s existing home sales data, which is set to show 2.5 percent month-over-month growth, following a 1.7 percent decline in June. Given low mortgage rates and home builder reports of additional foot traffic, a strong showing here would be a positive sign that prospective home buyers have not been scared away by rising home prices.

The minutes from the Fed’s July 31 meeting are also set to be released on Wednesday. This was a closely watched meeting, as the Fed voted to cut the federal funds rate for the first time in more than a decade, marking a shift toward a more supportive stance for the economy. Economists will be reading the minutes carefully to try to gauge the likelihood of future rate cuts.

Finally, we will close out the week with the release of July’s new home sales data on Friday. New home sales are forecast to decline by 0.2 percent during the month. Sales rose by 7 percent in June, so this projected decline is nothing to worry about—especially if we see growth in existing home sales, which make up a significantly larger portion of the housing market.

Disclosures: Certain sections of this commentary contain forward-looking statements that are based on our reasonable expectations, estimates, projections, and assumptions. Forward-looking statements are not guarantees of future performance and involve certain risks and uncertainties, which are difficult to predict. All indices are unmanaged and are not available for direct investment by the public. Past performance is not indicative of future results. The S&P 500 is based on the average performance of the 500 industrial stocks monitored by Standard & Poor’s. The Nasdaq Composite Index measures the performance of all issues listed in the Nasdaq Stock Market, except for rights, warrants, units, and convertible debentures. The Dow Jones Industrial Average is computed by summing the prices of the stocks of 30 large companies and then dividing that total by an adjusted value, one which has been adjusted over the years to account for the effects of stock splits on the prices of the 30 companies. Dividends are reinvested to reflect the actual performance of the underlying securities. The MSCI EAFE Index is a float-adjusted market capitalization index designed to measure developed market equity performance, excluding the U.S. and Canada. The MSCI Emerging Markets Index is a market capitalization-weighted index composed of companies representative of the market structure of 26 emerging market countries in Europe, Latin America, and the Pacific Basin. The Russell 2000® Index measures the performance of the 2,000 smallest companies in the Russell 3000® Index. The Bloomberg Barclays US Aggregate Bond Index is an unmanaged market value-weighted performance benchmark for investment-grade fixed-rate debt issues, including government, corporate, asset-backed, and mortgage-backed securities with maturities of at least one year. The U.S. Treasury Index is based on the auctions of U.S. Treasury bills, or on the U.S. Treasury’s daily yield curve. The Bloomberg Barclays US Mortgage Backed Securities (MBS) Index is an unmanaged market value-weighted index of 15- and 30-year fixed-rate securities backed by mortgage pools of the Government National Mortgage Association (GNMA), Federal National Mortgage Association (Fannie Mae), and the Federal Home Loan Mortgage Corporation (FHLMC), and balloon mortgages with fixed-rate coupons. The Bloomberg Barclays US Municipal Index includes investment-grade, tax-exempt, and fixed-rate bonds with long-term maturities (greater than 2 years) selected from issues larger than $50 million.

Mark Gallagher is a financial advisor located at Gallagher Financial Services at 2586 East 7th Ave. Suite #304, North Saint Paul, MN 55109. He offers securities and advisory services as an Investment Adviser Representative of Commonwealth Financial Network®, Member FINRA/SIPC, a Registered Investment Adviser. He can be reached at 651-774-8759 or at mark@markgallagher.com.

Authored by the Investment Research team at Commonwealth Financial Network.

© 2019 Commonwealth Financial Network ®

Presented by Mark Gallagher

General Market News
• U.S. Treasury rates fell considerably over the past two weeks. In fact, they fell at the fastest pace we’ve seen in some time and are now below where they were prior to the 2016 election. The 10-year Treasury yield is trading at 1.68 percent, quickly approaching its all-time low of 1.35 percent seen in July 2016. The 2-year is at 1.59 percent, and the 30-year is at 2.20 percent. It’s hard to imagine the 10-year was as high as 3.23 percent this past November.
• Despite a lot of volatility, markets were down modestly across the board last week. The volatility was driven largely by China’s response to U.S. tariffs proposed the week prior. China ended all U.S. agricultural purchases, as well as changed its overnight currency rate to roughly 7-to-1 yuan-to-dollars. This action led President Trump to accuse the country of manipulating its currency. It remains to be seen who will take the next step forward in the recent trade spat.
• Investors moved toward safety last week, as utilities, materials, health care, and staples outperformed. The worst-performing sectors were energy, financials, and technology.
• Last week got off to a rocky start with a disappointing result from July’s Institute for Supply Management Nonmanufacturing index. This survey, which measures business confidence for the service sector of the economy, fell from 55.1 in June to 53.7 in July, against expectations for a modest increase. This decline brought the index to its lowest level since August 2016. This is a diffusion index, where values greater than 50 indicate expansion. So, business owners still expect to see growth, but the slowdown in confidence should be monitored.
• On Friday, July’s Producer Price Index was released. Producer inflation rose by the expected 0.2 percent during the month and by 1.7 percent year-over-year. Interestingly, core inflation, which strips out volatile food and energy prices, decreased by 0.1 percent during the month. This was the first decline in core producer prices in two years, and it brought year-over-year growth for core producer inflation down to 2.1 percent.

Source: Bloomberg

Source: Morningstar Direct

What to Look Forward To
This week will begin with Tuesday’s release of the Consumer Price Index for July. Consumer prices are expected to show 0.3 percent growth for the month, which should bring year-over-year inflation up to 1.7 percent. As was the case with producer prices, the core measure of consumer inflation is expected to show 2.1 percent year-over-year growth, which is broadly in line with the Federal Reserve’s stated 2 percent inflation target.

On Thursday, July’s retail sales data will be released. It is expected to show solid 0.3 percent monthly growth. Strong consumer spending was a major driver for second-quarter gross domestic product growth, so continued strength to start the third quarter would be a positive sign.

Also on Thursday, July’s industrial production report is set to be released. Economists expect production to increase by 0.1 percent on a month-over-month basis, which would be a step up from June’s flat result.

Thursday will also see the release of the August National Association of Home Builders Housing Market Index, which is a gauge of home builder sentiment. Home builder confidence is expected to increase slightly, from 65 in July to 66 in August. Confidence rose in July following a surprise decline in June, so another increase in August would be welcome.

On Friday, we’ll see if improved home builder confidence in July translated to more home building, as July’s housing starts and building permits are both set to be released. Both measures of new home building activity are expected to show modest growth in July following declines in June.

Finally, we’ll finish off the week with Friday’s release of the University of Michigan consumer sentiment survey. It is expected to decline from 98.4 in July to 97.5 in August. Stock market turbulence often weighs on consumer comfort, so it should come as no surprise that economists expect the recent market volatility to negatively affect confidence. Despite the projected decline, we’re still well above levels seen in January and February. As such, there is nothing to worry about yet.

Disclosures: Certain sections of this commentary contain forward-looking statements that are based on our reasonable expectations, estimates, projections, and assumptions. Forward-looking statements are not guarantees of future performance and involve certain risks and uncertainties, which are difficult to predict. All indices are unmanaged and are not available for direct investment by the public. Past performance is not indicative of future results. The S&P 500 is based on the average performance of the 500 industrial stocks monitored by Standard & Poor’s. The Nasdaq Composite Index measures the performance of all issues listed in the Nasdaq Stock Market, except for rights, warrants, units, and convertible debentures. The Dow Jones Industrial Average is computed by summing the prices of the stocks of 30 large companies and then dividing that total by an adjusted value, one which has been adjusted over the years to account for the effects of stock splits on the prices of the 30 companies. Dividends are reinvested to reflect the actual performance of the underlying securities. The MSCI EAFE Index is a float-adjusted market capitalization index designed to measure developed market equity performance, excluding the U.S. and Canada. The MSCI Emerging Markets Index is a market capitalization-weighted index composed of companies representative of the market structure of 26 emerging market countries in Europe, Latin America, and the Pacific Basin. The Russell 2000® Index measures the performance of the 2,000 smallest companies in the Russell 3000® Index. The Bloomberg Barclays US Aggregate Bond Index is an unmanaged market value-weighted performance benchmark for investment-grade fixed-rate debt issues, including government, corporate, asset-backed, and mortgage-backed securities with maturities of at least one year. The U.S. Treasury Index is based on the auctions of U.S. Treasury bills, or on the U.S. Treasury’s daily yield curve. The Bloomberg Barclays US Mortgage Backed Securities (MBS) Index is an unmanaged market value-weighted index of 15- and 30-year fixed-rate securities backed by mortgage pools of the Government National Mortgage Association (GNMA), Federal National Mortgage Association (Fannie Mae), and the Federal Home Loan Mortgage Corporation (FHLMC), and balloon mortgages with fixed-rate coupons. The Bloomberg Barclays US Municipal Index includes investment-grade, tax-exempt, and fixed-rate bonds with long-term maturities (greater than 2 years) selected from issues larger than $50 million.

Mark Gallagher is a financial advisor located at Gallagher Financial Services at 2586 East 7th Ave. Suite #304, North Saint Paul, MN 55109. He offers securities and advisory services as an Investment Adviser Representative of Commonwealth Financial Network®, Member FINRA/SIPC, a Registered Investment Adviser. He can be reached at 651-774-8759 or at mark@markgallagher.com.

Authored by the Investment Research team at Commonwealth Financial Network.

© 2019 Commonwealth Financial Network ®