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  • Writer's pictureHolzberg Wealth Management

The Long-Term: A 50-Year Reunion, a 30th Anniversary, 42 Years of Service, and the Next Generation.

HWM Market Recap - July 2023

Holzberg Wealth Management Newsletter
​Executive Market Summary

This month, I wish to address a topic that is not directly about investing or financial planning but is part and parcel of everything we do. Specifically, the long-term relationships that we develop with you, our friends, and clients. This is something that we very much appreciate.

But first, regarding our investments, the many economic uncertainties keep us ever vigilant regarding the risks that bear on our portfolios. The good news is that the economy seems to be working through the issues industry-by-industry rather than all at once. Consequently, the bumps along the way are not as bad as they could be with an economy-wide recession – at least so far. In addition, with interest rates rising for over a year, we can now earn excellent returns in fixed-income (CDs, money markets, and T-Bills). This allows us to have a better, more diversified balance between stocks and bonds which helps reduce risk.

In our line of work, our investment strategy is geared toward the long term. We are always contemplating investments that we can hold for years. Short-term trading is something that we leave for those who wish to specialize in that particular skill set. There is an old quip about traders on the floor of the New York Stock Exchange for whom the long-term is said to be lunch. On the other side of the coin, Warren Buffet is credited with saying that his favorite holding period for an investment is forever.

Two personal events, one just past and the other soon to be, have caused me to think about the long term. The first event was attending my 50th high school reunion, that of the 1973 class of North Miami Senior High School – home of the fighting Pioneers. It was a well-organized event, with a large turnout, and a good time was had by all. Many of the people I had neither seen nor heard from since graduation, and catching up was lots of fun and very interesting. Even better was to spend time with those I have kept in touch with over the years. We are scattered across the country, and spending time in person made me appreciate those long-term friendships more fully. Another long-term relationship with an approaching milestone is my marriage to my lovely and talented wife, Patti. We will celebrate 30 wonderful years of marriage over the Labor Day weekend. All of this is to say that just as the fruits of long-term investing are necessary and important, so too are the wonderful benefits of long-term relationships. A friend of mine observed many years ago that the only things we take with us are our memories and the love of the people in our lives.

Moreover, I completed my forty-second year working in financial services last month. I first developed an interest in the stock market during my teen years and, as I have often said, my goal is to still be picking stocks when I am ninety. Another goal is to provide long-term continuity of service to you. My son, and business partner, Marcus and I are working diligently to make this happen for many years to come.

As financial advisors, one of the most valuable things we do is build long-term relationships with our clients. In this way, we can be there for you when you need us most. Over the course of my long career, the most fulfilling part of my job has been to develop friendships with clients and bring a humanistic element to discussions that can otherwise be inundated by financial formalities. We strive to earn our clients' confidence by easing personal and financial burdens throughout their lives in order to build long-term professional relationships.

We will continue our discussion of the financial markets more fully in our next monthly letter. At this moment, I would like to say that our family greatly appreciates each of you, and we will continue to endeavor to provide the personal and professional services of a trusted long-term financial advisor.

​Markets Overview

​Monthly Changes in Indices

  • S&P 500: +6.47%

  • DJIA: +4.66%

  • Nasdaq Composite: +6.59%

​Year-to-Date Changes in Indices

  • S&P 500: +15.91%

  • DJIA: +4.85%

  • Nasdaq Composite: +31.73%

​Monthly Performance By Sector

  1. Consumer Discretionary +12.25%

  2. Industrials +11.28%

  3. Materials +11.04%

  4. Energy +6.91%

  5. Financials +6.67%

  6. Technology +6.18%

  7. Real Estate +5.58%

  8. Communication Services +4.75%

  9. Health Care +4.34%

  10. Consumer Staples +2.82%

  11. Utilities +1.63%

​Year-to-Date Sector Performance

  1. Technology +40.36%

  2. Communication Services +36.25%

  3. Consumer Discretionary +32.16%

  4. Industrials +10.12%

  5. Materials +7.68%

  6. Real Estate +3.74%

  7. Consumer Staples +0.65%

  8. Financials -0.54%

  9. Health Care -1.51%

  10. Energy -5.49%

  11. Utilities -5.70%

Monthly Top 5 Performers

Consumer Discretionary +12.25%

Consumer discretionary rose to the best-performing sector in June from the third-best in May. Its leaders included: Carnival Corp (+67.67%), Norwegian Cruise Line Holdings Ltd (+46.59%), Tesla Inc (+28.36%), Royal Caribbean Group (+28.12%), and Ford Motor Co (+26.08%).

Industrials +11.28%

Industrials rose from the fourth-best-performing sector in May to the second-best in June. Its leaders included: Generac Holdings Inc (+36.91%), United Rentals Inc (+33.42%), Delta Air Lines Inc (+30.85%), Stanley Black & Decker Inc (+26.06%), and Carrier Global Corp (+21.99%).

Materials +11.04%

Materials also rose from eighth-best to the third-best-performing sector between May and June, with its leaders including: Nucor Corp (+24.55%), Sherwin-Williams Co (+16.56%), Freeport-McMoRan Inc (+16.48%), Martin Marietta Materials Inc (+15.99%), and Albermarle Corp (+15.48%).

Energy +6.91%

Energy had a solid month after being the worst-performing sector in May. Its leaders included: EQT Corp (+18.29%), Baker Hughes Co (+16.00%), Halliburton Co (+15.70%), Williams Companies Inc (+15.41%), and SLB (+15.26%).

Financials +6.67%

Financials also had a nice month, with its leaders including: Signature Bank (+74.70%), SVB Financial Group (+34.50%), Lincoln National Corp (+23.13%), Comerica (+19.30%), and Invesco Ltd (+16.89%).

​Political Events Influencing the Economy
  • The Federal Reserve announced that it would pause raising interest rates after ten consecutive increases over a period of 15 months. However, the Chairman of the Federal Reserve, Jerome Powell, signaled they are anticipating two more rate hikes before year-end.

  • The Bureau of Labor Statistics released the Consumer Price Index (CPI) report for May, indicating that consumer prices rose 4% in May from a year earlier. This reading is less than half the peak inflation rate in June 2022 but remains above what Fed officials would like to see.

  • According to Bureau of Labor Statistics data, the economy gained 339,000 nonfarm payrolled employees in May. However, the unemployment rate rose by 0.3% to 3.7%. The unemployment rate has stayed within a range of 3.4-3.7% since March 2022. Even with a tight job market, the average number of hours worked per week by private-sector employees fell to 34.3 in May.

  • U.S. applications for jobless claims for the last week of June numbered 239,000, down from 265,000 the week prior. June ended with a monthly average of 257,500 in initial claims, an increase of 1,500 from the previous week’s revised average. This marks the highest level for the average since November 13th, 2021.

  • The National Association of Home Builders/Wells Fargo Housing Market Index, which takes the pulse of the single-family housing market, rose by five points between May to June, the highest reading since July 2022. Moreover, according to the U.S. Census Bureau, the number of homebuilding projects started rose 21.7% in May from the prior month to the highest level in over a year.

  • With the passing of the debt ceiling deal, the student loan repayment moratorium will end on August 29th, affecting 45 million borrowers. Student loan interest will resume on September 1st, and payments will be due starting in October. According to a survey conducted by the Federal Reserve in 2017, the average monthly student payment was $393. Also, as reported by the WSJ, analysts estimate that borrowers will collectively resume paying $5 billion to $10 billion monthly for their student loan repayments.

  • The Federal Reserve conducted its annual bank stress test, which revealed that all 23 of the U.S. banks included in the test weathered a severe recession scenario while continuing to lend to consumers and corporations. This test began in the aftermath of the 2008 financial crisis, and it dictates how much capital the industry can return to shareholders via buybacks and dividends. In this year’s exam, the banks underwent a simulated “severe global recession,” with unemployment reaching 10%, a 40% decline in the value of commercial real estate, and a 38% decrease in housing prices.

  • The Securities and Exchange Commission is suing two of the largest cryptocurrency exchanges, Binance and Coinbase. The SEC is charging the two companies with operating as unregistered exchanges, brokers, and clearing agencies while offering trading for crypto assets, which it considers securities.

  • According to an analysis by Zillow and Thumbtack, recurring costs associated with owning a home, in addition to mortgage payments, average about $14,155 annually ($1,180 per month). These hidden costs include utilities, insurance, maintenance, and property taxes.

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About the Author

Holzberg Wealth Management is a family-owned and operated financial planning and investment management firm based in Marin County, CA. As your financial advisors, we serve you as a fiduciary and are fee-only, so we never receive commissions of any kind. We help individuals and families like you in the greater San Francisco Bay Area and virtually nationwide with the financial decision-making process to organize, grow, and protect your assets.

** This writing is for informational purposes only. The author and Holzberg Wealth Management do not guarantee or otherwise promise any results that may be obtained from using this report. No reader should make any investment decision without first consulting their financial advisor and conducting their own research and due diligence. These commentaries, analyses, opinions, and recommendations represent the personal and subjective views of the author and do not constitute a recommendation, offer, or solicitation to make any securities transaction. The information provided in this report is obtained from sources that the author believes to be reliable. External links to third parties are being provided for informational purposes only. Holzberg Wealth Management is not affiliated with the third-party websites linked to, unless otherwise explicitly stated, and does not constitute an endorsement or approval by Holzberg Wealth Management of any of the third party’s products, services, or opinions.


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