Weekly Update by Wally

Markets Edgy Over Syria & Tapering

Markets ended the short week in the black despite sustained volatility as traders worried about escalating tensions in Syria and the prospect of an end to the Federal Reserve's economic stimulus. For the week, the S&P 500 gained 1.36%, the Dow climbed 0.76%, and the Nasdaq rallied 1.95%.

Tensions in Syria accounted for a lot of the volatility we saw last week as members of the Obama administration urged humanitarian intervention in the country's bloody civil war. Investors also reacted nervously to sabre rattling between President Obama and Russian President Putin over Syria. The prospect of military action has also affected oil markets, causing the price of West Texas Intermediate to close at $110.63, its highest close since May 2011.

Stocks shot up midweek following a weaker-than-expected August jobs report, a key factor in the Fed's deliberations about tapering. While the headline unemployment rate fell to 7.3% - a 4 ½ year low - nonfarm jobs grew by only 169,000, missing expectations and raising questions about whether the Fed will wait to cut back on its easy money policy. A positive jobs report was expected to be a crucial piece of evidence in the Fed's debates about when to taper its $85 million per month bond-buying program. However, the tepid report casts doubt on whether the Fed will turn down the dial after its September 17-18 FOMC meeting. While we're not sure what will happen this month, Fed hawks (officials who aggressively support tapering) and doves (those who support quantitative easing) agree that the Fed will cut back on quantitative easing this year.

Looking ahead at this week, we're expecting another jolt of volatility as Congress debates authorizing a military strike against Syria and analysts ponder the upcoming Fed tapering decision. A Senate vote on Syria could come midweek and a vote by the House several days later. Investors will also be closely monitoring economic reports on consumer sentiment, August retail sales, and business inventories.

These are the views of Platinum Advisor Marketing Strategies, LLC, and not necessarily those of the named Wealth Financial Partners,  First Allied Securities or First Allied Advisory, and should not be construed as investment advice. Neither Wealth Financial Partners nor First Allied Securities or First Allied Advisory gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information.

Walter Pardo is the Founder and Managing Partner of Wealth Financial Partners.  and Founder of WFP Tax Partners.  Website:  www.wealthfinancialpartners.com

Securities offered through First Allied Securities, Inc., A Registered Broker Dealer, Member FINRA/SIPC

Advisory services offered through First Allied Advisory Services, Inc, a Registered Investment Advisor.

The opinions expressed herein are the writer's alone, and do not reflect the opinions of TAPinto.net or anyone who works for TAPinto.net. TAPinto.net is not responsible for the accuracy of any of the information supplied by the writer.

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