Is the Market overbought???? We do not think so at this point…

Markets were mixed last week; gains for the Dow Jones Industrial Average and S&P 500® Index continued while the technology-heavy NASDAQ and Russell 2000® Index of small company stocks lagged.  As investors gravitated towards conservative areas of the market, electric utilities were the strongest performers followed by consumer staples companies, such as food and beverages.  The euphoria that is normally at major market tops is largely absent despite the fact that major market indices are hitting all-time highs.  At 8% above its 200 day moving average, the S&P is by no means overbought. The 12-14% range is generally a more statistically significant overbought signal. Heightened investor anxieties led to a decline in Treasury yields and an increase in the CBOE Volatility Index (or, the “fear gauge”).  Market momentum stalled followed comments by Treasury Secretary Steven Mnuchin on Thursday that he hoped to have a comprehensive tax reform package approved before Congress’ August recess; the timeline disappointed investors expecting a Presidential announcement as early as next week.  Economic data, meanwhile, remained upbeat; strong home sales activity is increasing homeowners’ equity and, in turn, boosting consumer confidence.  At the same time, younger people are increasingly interested in transitioning from apartments to single-family homes.  Millennials, which last year surpassed Baby Boomers as the largest living generation in America, will likely have a major impact on economic trends for decades to come.

During President Trump’s first 30 days in office, the Dow gained 4.02%, the best mark since the start of Franklin D. Roosevelt fourth term in 1945.  More recently, though, cautious skepticism due, in part, to high valuations for the major stock indices, is increasingly challenging investor optimism.  We note that, while overall index levels may be somewhat elevated, certain industries and individual companies are still attractively valued.  For example, the recovery in the energy sector remains in its early stages; with OPEC adhering to its production freeze agreement and global oil demand continuing to rise, energy is poised to be a significant growth area over the next several years.  Moreover, the benefits of reduced corporate taxes and a lighter regulatory regime are difficult to overstate; together, they could accelerate U.S. GDP growth beyond the modest 2% average since 2010.  An improvement to a 3% or higher growth rate, a noteworthy development, would justify further market gains.  Certainly, risks remain, and investors are appropriately discounting the possibility that some of these initiatives will falter.  Nevertheless, the current climate of business optimism and improving economic conditions should help stocks hold onto their recent gains as these critical questions are addressed.

Source:  Pacific Global Investment Management Company

market close

Chart reflects price changes, not total return. Because it does not include dividends or splits, it should not be used to benchmark performance of specific investments.


Last Week's Headlines

  • Existing home sales surged in January, according to the National Association of Realtors®. Total existing home sales expanded 3.3% to a seasonally adjusted annual rate of 5.69 million from an upwardly revised 5.51 million in December. January's sales pace is 3.8% higher than it was a year ago and is the strongest annual rate since February 2007. The median existing-home price for all housing types in January was $228,900, up 7.1% from January 2016 ($213,700). The annual price increase 232,200 in January was the fastest 12-month increase since last January (8.1%) and marks the 59th consecutive month of year-over-year gains. Inventory increased 2.4% in January, which helped fuel the increase in sales. There is a 3.6-month supply of inventory at the current sales pace. Despite rising mortgage rates and relatively scant inventory, the increase in home sales may be indicative of consumers' confidence in the labor market and in the economy.
  • New home sales also picked up the pace in January. At an annual rate of 555,000 in January, new home sales were 3.7% above the revised December rate of 535,000 and 5.5% above the January 2016 estimate of 526,000. The median sales price of new houses sold in January 2017 was $312,900 ($316,200 in December). The average sales price was $360,900 ($378,900 in December). The 265,000 new homes for sale at the end of January represents a supply of 5.7 months at the current sales rate.
  • Minutes from the FOMC meeting at the end of January point to a greater likelihood of an interest rate hike when the Committee next meets in March. Concerned that the pace of inflation may increase based on policy proposals from the Trump administration, some members of the Committee posed the possibility for more aggressive action, particularly if the unemployment rate falls.
  • Consumer sentiment was still strong in February, although the Index of Consumer Sentiment edged down to 96.3 compared to the decade peak of 98.5 recorded in January. During the past three months, the Index of Consumer Sentiment has been higher than any time since March 2004. According to Surveys of Consumers chief economist Richard Curtin, "Normally, the implication would be that consumers expected Trump's election to have a positive economic impact. That is not the case since the gain represents the result of an unprecedented partisan divergence, with Democrats expecting recession and Republicans expecting robust growth." Curtin further explained, "While the expectations of Democrats and Republicans largely offset each other, the overall gain in the Expectations Index was due to self-identified Independents, who were much closer to the optimism of the Republicans than the pessimism of the Democrats."
  • In the week ended February 18, the advance figure for seasonally adjusted initial unemployment insurance claims was 244,000, an increase of 6,000 from the previous week's revised level. The advance seasonally adjusted insured unemployment rate remained at 1.5%. The advance number for seasonally adjusted insured unemployment during the week ended February 11 was 2,060,000, a decrease of 17,000 from the previous week's revised level. Compared to the same period last year, the number of unemployed is 9.4% lower than the 2,253,000 unemployed claimants for the week ended February 13, 2016.


Eye on the Week Ahead

Investors will be focused on the revised numbers for the Q4 GDP, as well as the latest consumer income and spending figures from January.



Brian Amidei, along with Partners Joseph Romano and Brett D'Orlando have also been named *2014, 2015, 2016, 2017, 2018 Five Star Wealth Managers!

Awards and recognitions by unaffiliated rating services, companies, and/or publications should not be construed by a client or prospective client as a guarantee that he/she will experience a certain level of results if Fortem is engaged, or continues to be engaged, to provide investment advisory services; nor should they be construed as a current or past endorsement of Fortem or its representatives by any of its clients. Rankings published by magazines and others are generally based on information prepared and/or submitted by the recognized advisor. Awards may not be indicative of one client’s experience or of the Firm’s future performance. Neither Fortem nor the recognized advisor has paid a fee for inclusion on a list, nor purchased any additional material from the award provider. The criteria for each award is listed below:

Five Star Professional Disclosure:
The Five Star Wealth Manager award is based on 10 eligibility and evaluation criteria: 1) Credentialed as an investment advisory representative (IAR) or a registered investment advisor; 2) Actively employed as a credentialed professional in the financial services industry for a minimum of five years; 3) Favorable regulatory and complaint history review; 4) Fulfilled their firm review based on internal firm standards; 5) Accepting new clients; 6) One-year client retention rate; 7) Five-year client retention rate; 8) Non-institutionalized discretionary and/or non-discretionary client assets administered; 9) Number of client households served; and 10) Educational and professional designations. The inclusion of a wealth manager on the Five Star Wealth Manager list should not be construed as an endorsement of the wealth manager by Five Star Professional or the magazine. The award methodology does not evaluate the quality of services provided. Additional information about this award is available at:
Fortem Financial 2016. All rights reserved.

Data Sources: News items are based on reports from multiple commonly available international news sources (i.e. wire services) and are independently verified when necessary with secondary sources such as government agencies, corporate press releases, or trade organizations. Market Data: Based on reported data in WSJ Market Data Center (indexes); U.S. Treasury (Treasury Yields); U.S. Energy Information Administration/ Market Data (oil spot price, WTI Cushing, OK); (spot gold/silver); Oanda/FX Street (currency exchange rates). All information is based on sources deemed reliable, but no warranty or guarantee is made as to its accuracy or completeness.

Neither the information nor any opinion expressed herein constitutes a solicitation for the purchase or sale of any securities, and should not be relied on as financial advice. The opinions expressed are solely those of the author, and do not represent those of Fortem Financial, LLC or any of its affiliates. Past performance is no guarantee of future results. All investing involves risk, including the potential loss of principal, and there can be no guarantee that any investing strategy will be successful. Forward looking statements are based on current expectations and assumptions, the economy, and future conditions. As such, forward-looking statements are subject to inherent uncertainty, risks, and changes in circumstance that are difficult to predict. Actual results may differ materially from the anticipated outcomes. Carefully consider investment objectives, risk factors and charges and expenses before investing. Fortem Financial is a registered investment adviser with the SEC. Advisory services are offered through Fortem Financial.

The Dow Jones Industrial Average (DJIA) is a price-weighted index composed of 30 widely traded blue-chip U.S. common stocks. The S&P 500 is a market-cap weighted index composed of the common stocks of 500 leading companies in leading industries of the U.S. economy. The NASDAQ Composite Index is a market-value weighted index of all common stocks listed on the NASDAQ stock exchange. The Russell 2000 is a market-cap weighed index composed of 2,000 U.S. small-cap common stocks. The Global Dow is an equally weighted index of 150 widely traded blue-chip common stocks worldwide. Market indices listed are unmanaged and are not available for direct investment.

Fortem Financial

Recent Posts


Fortem Financial Group, LLC, has adopted this policy with recognition that protecting the privacy and security of the non-public personal information we obtain about our customers is an important responsibility.

All financial companies choose how they share your non-public personal information. Federal law gives consumers the right to limit some but not all sharing. Federal law also requires us to tell you how we collect, share, and protect your non-public personal information. Even when you are no longer our customer, we will only share your non-public personal information as described in this notice. So, please read this notice carefully to understand what we do.

The types of non-public personal information we collect and share depend on the product or service you have with us. This information can include items such as your Social Security number and income, your account balances and transaction history, and your investment experience and account transactions.

We collect your non-public personal information in a variety of ways. For example, we obtain your non-public personal information when you open an account or give us your income information, tell us about your portfolio or deposit money, or enter into an investment advisory contract. We also collect your non-public personal information from other companies. For example, from the custodians who hold your account assets.

All financial companies need to share customer’s non-public personal information to run their everyday business. Below, we describe the reasons we can share your non-public personal information and whether you can limit this sharing.

We share your non-public personal information for our everyday business purposes such as to process your transactions, maintain your account(s), respond to court orders and legal investigations, report to credit bureaus, to protect the confidentiality or security of your records, or as permitted by law. We may also share your non-public personal information for our own firm’s marketing purposes; so that we can offer our products and services to you.

Federal law gives you the right to limit only sharing non-public personal information about your credit worthiness for our affiliates’ everyday business purposes; sharing non-public personal information about you with our affiliates to market to you; and sharing non-public personal information with non-affiliates to market to you.

We don’t share non-public personal information about your creditworthiness with our affiliates for their everyday business purposes. We don’t share your non-public personal information with our affiliates to market to you. We don’t share your non-public personal information with non-affiliates to market to you. We also don’t share your non-public personal information for joint marketing with other financial companies. State laws and individual companies may give you additional rights to limit sharing.

We share non-public personal information with our parent company affiliate, Focus Financial Partners, Inc, for its internal and external auditing purposes. We also share your non-public personal information with a non-affiliate for the purpose of aggregating it and providing summary information based on this data to our parent company, Focus Financial Partners, Inc.

To protect your non-public personal information from unauthorized access and use, we use security measures that comply with federal law. These measures include computer safeguards and secured files and buildings.

Our policy about obtaining and disclosing non-public personal information may change from time to time. We will provide you notice of any material change to this policy before we implement the change.

If you have questions please call us at 760-206-8500 or go to our website at


Fortem Financial Group, LLC ("Fortem Financial" or the "Firm") is a federally registered investment adviser with offices in California and Arizona. Fortem Financial and its representatives are in compliance with the current registration and notice filing requirements imposed upon federally registered investment advisers by those states in which Fortem Financial maintains clients. Fortem Financial may only transact business in those states in which it is notice filed, or qualifies for an exemption or exclusion from notice filing requirements.

This website is limited to the dissemination of general information regarding the Firm's investment advisory services offered to U.S. residents residing in states where providing such information is not prohibited by applicable law. Accordingly, the publication of Fortem Financial' website on the Internet should not be construed by any consumer and/or prospective client as a solicitation to effect, or attempt to effect transactions in securities, or the rendering of personalized investment, tax or legal advice. Furthermore, the information resulting from the use of any tools or other information on this website should not be construed, in any manner whatsoever, as the receipt of, or a substitute for, personalized individual advice from Fortem Financial. Any subsequent direct communication from Fortem Financial with a prospective client will be conducted by a representative that is either registered or qualifies for an exemption or exclusion from registration in the state where the prospective client resides. Fortem Financial does not make any representations as to the accuracy, timeliness, suitability, completeness, or relevance of any information prepared by any unaffiliated third party, whether linked to this website or incorporated herein, and takes no responsibility therefore. All such information is provided for convenience purposes only and all users thereof should be guided accordingly.

All statements and opinions included on this website are subject to change as economic and market conditions dictate, and do not necessarily represent the views of Fortem Financial or any of their respective affiliates. Past performance may not be indicative of future results and there can be no assurance that any views, outlooks, projections or forward-looking statements will come to pass. Investing involves risk, including the potential loss of principal, and the profitability of any particular investment strategy or product cannot be guaranteed.

Any rating referenced herein may not be representative of any one client's experience. Further, the Firm's receipt of any rating is not indicative of the Firm's future performance. The Charles E. Merrill Circle of Excellence award is granted by Merrill Lynch for outstanding client service and satisfaction. The award is granted based on annual criteria established by Merrill Lynch for its top decile advisors. The Barron's Top 1,200 Financial Advisors rating of the top financial advisors in the United States is based on data provided by participating firms. The following factors are included in the rankings: assets under management, revenue produced for the firm, regulatory record, quality of practice and philanthropic work. Investment performance is not an explicit component. The Palm Springs Life's "40 Under 40" Rising Young Professionals to Watch in the Coachella Valley is based upon nominations from the local business community and selected by the staff of Palm Springs Life.

For information pertaining to the registration status of Fortem Financial, please refer to the Investment Adviser Public Disclosure website, operated by the U.S. Securities and Exchange Commission, at, which contains the most recent versions of the Firm's Form ADV disclosure documents.