LifeSteps Financial Market Update | June 2018
Turmoil and Tariffs
Looking Back at May
As expected, market volatility continued throughout the month of May.

There were positives during the month.
  • Oil prices have receded from their highs
  • The 10-year treasury bill has temporally dropped below 3%
  • A new law was signed into effect which should give the smaller banks a less stringent regulatory environment. (This should help smaller banks compete with larger ones.)

Negatives for the market were generally geopolitical in nature.
In March, President Trump announced plans for steel and aluminum tariffs, but granted some exemptions while countries negotiated. Beginning June 1, 2018, all tariffs are back in play. The reasons cited were lack of progress on new negotiated deals. We feel the U.S. will prevail with better trade policies.
Another smaller down side that took place the last few days of the month is the financial stability of Italy. Government borrowing costs are skyrocketing. Investors are worried that Italy may drop out of the Eurozone and its common currency. If Italy were to pull out, the effects would ripple throughout Europe with Spain being the next to drop out of the euro.
Looking Ahead to June
U.S. economic data is growing stronger as the year progresses. The May jobs report was very good. We expect growth in our economy to continue. We do expect volatility to continue with the new tariffs that went into effect June 1st, our approaching elections, and the problems with European economies.
Our View
The summer is typically when many investors let their investments sit, so action in the market is often more volatile because fewer investors are participating. As investors, not traders, we need to look past the summer and into the fall. As interest rates begin to trend higher, we believe that our allocations should tilt away from fixed income. We feel that the summer will still bring geopolitical tension to the market, but the U.S. economy is strong and should push equities higher as we move into the 4th quarter and beyond.
We will continue to closely monitor economy developments, as well as global events that effect the market.
If you have any questions, please contact us.


Henry Ford

LifeSteps Financial Advisors      
This report is for information purposes only and is not a recommendation for any particular security. Mention of individual securities should not imply that we own the security or have owned it in the past. In addition, the information provided here should not form the basis for investment decisions. Past performance is no guarantee of future results. This information should not be used in any transaction without the advice and guidance of your Tax Professional. LifeSteps Financial has not independently verified, or attested to the accuracy or authenticity of the information, including any investment performance measurement.
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