2018 Year in Review

February, 2019

Dear Valued Customer,

As 2019 is off and running, we wanted to take a moment to review with you some highlights of 2018 and the first month of 2019. During 2018, the S&P 500 Index hit three new all-time closing highs; on January 26th, August 29th, and September 20th, respectively. The market also survived two corrections, defined as declines of at least 10% from a recent high. The volatility felt in 2018 seemed magnified due to the constant, steady increase in market returns the year 2017 brought us.

During 2018, the Federal Reserve Open Market Committee increased the overnight rate, which sets the tone for interest rates in all areas of the market, four times in 2018, closing 2018 at a range of 2.25 – 2.50%. The rate hikes in 2018 bring the total number of interest rate increases to nine, since the Fed began raising rates from near-zero three years ago. U.S. Gross Domestic Product, the total dollar value of all goods and services produced over a specific time period, increased 2.2%, 4.2% and 3.5% during the first three quarters of 2018. The unemployment rate decreased from 4.1% in January, 2018 to 3.9% in December. The U.S. December jobs report saw employment gains of 222,000, rising labor force participation and hours worked, and average hourly earnings growth of over 3% for the third consecutive month. The average monthly jobs growth in 2018 was 220,000 compared to 182,000 in 2017 and 195,000 in 2016.

The S&P 500 Index returned 7.9% in January 2019, marking the best January performance since 1987 when the Index rose 13.2%. The first U.S. jobs report of 2019 saw gains of 304,000 jobs, surpassing economic forecasts. The Federal Reserve opted not to raise interest rates during its January policy meeting and pledged that future moves will be data dependent and done patiently.

The Financial Services Department’s position has been, and will continue to be, to focus on a well-diversified portfolio, utilizing high quality stocks and fixed income instruments to help our clients achieve their current and future needs. We continue to focus on the credit quality of our fixed income portfolio, laddering positions to mature in the short to intermediate timeframe. Trustco Bank Financial Services Department will customize a tailored portfolio to meet your needs, with diversification and long term growth at the helm. Our philosophy of investing in high quality stock and bond instruments allows our client’s portfolios to withstand the ups and downs of the financial markets.

We look forward to working with you in the current year and helping you to achieve your financial goals.  Trustco Bank is committed to a consistently high quality client experience, serving you with expert advisors while keeping your portfolio on track as you continue toward your financial goals.

Please call us anytime you have questions or if you know of anyone who would be able to benefit from our services.

Best Regards,

Your Financial Services Team

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