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What a great year for stocks.

2019 was a great year for stocks. The S&P 500 was up 31.5%. Trade negotiations fueled market ups and downs mid-year but the year ended with the Federal Reserve stepping in to buy bonds and the news of a deal with China fueling a big rally. 2020 has started off strong with the market continuing to post highs. We look for this year to continue to react to trade war news but end higher in December as earnings improve because of the stress-relieving benefits of the phase 1 trade deal. Corporate earnings in 2019 were severely handicapped by trade. As these issues go away, earnings should improve. Current valuations look stretched. We may soon see a pull-back, but as we go through this year, earnings should do better and the stock market should continue to do well.

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