Weekly Investor – August 12, 2019
A Wild Ride
The S&P 500® Index declined 0.5% last week which appeared mild following the previous week’s -3.1% return, the index’s worst week of 2019. However, last week’s trading was anything but mild as volatility showed a swing of approximately 4% from the week’s low to the week’s high. Monday was especially painful as the S&P has it’s worst day of the year, declining almost 3.0% on fears of the trade war escalating further. After U.S. President Trump announced more tariffs on Chinese goods, China responded by freezing purchases of U.S. agricultural products and appearing to allow their currency to devalue, signaling they would respond to any further U.S. tariffs. Equities rallied back throughout the week as the index clawed back most of Monday’s loss.
U.S. Treasury Bonds saw another week of falling yields. Investors continue to prefer government paper over riskier assets as global economic sentiment wanes. On Monday, the 2-year Treasury yield fell to its lowest level since the end of October in 2017.
The S&P 500 was down 0.5% for the week. Its top-performing sectors were Real Estate (1.8%) and Utilities (1.0%), while bottom-performing sectors were Financials (-1.7%) and Energy (-2.2%). In the fixed-income market, the 10-year Treasury yield was down, ending at 1.7%.
We continue to seek companies that reflect our Change-BasedSM investment approach.
Change Based Investment
JPMorgan Chase & Co. (JPM) is a financial holding company that provides financial services worldwide. Founded in 1823 and headquartered in New York, JPMorgan operates in several segments: investment banking, commercial banking, asset management, retail finance and credit card and auto finance.
JPMorgan emerged from the U.S. financial crisis with a solid balance sheet that provided its management team the opportunity to execute their business plan. As a result, JPMorgan was able to gain market share and improve its profitability. We believe JPMorgan is well-positioned to take advantage of a growing U.S. economy and has the potential to gain market share in Europe with the continued weakness in the Continent’s financial system. Because of this, JPMorgan fits well with Argent’s Change-BasedSM investment approach.
Top 5 Equity Holdings
Large Cap Growth
| Alphabet Inc. (Google) | 7.7% |
| Mastercard, Inc. | 5.7% |
| Fiserv, Inc. | 5.4% |
| Post Holdings, Inc. | 5.1% |
| Marvell Technology | 4.9% |
Small Cap Core
| Fortinet Inc. | 3.0% |
| Planet Fitness,Inc. | 2.7% |
| Upland Software Inc. | 2.6% |
| OneMain Holdings, Inc. | 2.6% |
| Vonage Holdings | 2.6% |
Dividend Select
| JPMorgan Chase & Co. | 5.7% |
| Microsoft Corp./td> | 4.5% |
| Marvell Technology Group | 4.4% |
| Fidelity National Financial | 4.0% |
| Target Corporation | 3.9% |
Mid Cap
| Cintas Corporation | 4.1% |
| CDW Corporation | 4.0% |
| Amedisys, Inc. | 3.4% |
| Bright Horizons Family | 3.4% |
| NVR, Inc. | 3.3% |
This newsletter presents selected recommendations from portfolio managers of Argent Capital Management LLC, a registered investment advisor. Opinions reflect the portfolio manager’s judgment on the date above and are subject to change. A list of stocks recommended by Argent is available upon request. You should not assume that these recommendations are or will be profitable. In the course of it’s business, Argent’s client accounts may be buying and selling these stocks.
