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US markets closed lower on Monday

29 Nov 2016 Evaluate

The US markets closed lower on Monday, as investors found few reasons to keep pushing shares higher following an extended rally that took major indexes to a string of records and lifted major indexes for three straight weeks. Stocks were left overbought as investors have placed faith in promises of stronger growth and less regulation under a Trump presidency. Investors expect that the president-elect will advocate for policies - such as infrastructure spending, massive corporate tax cuts and environmental and financial deregulation - that could spur economic growth. In its twice-yearly Economic Outlook, the Organization for Economic Cooperation and Development (OECD) estimated global growth would accelerate from 2.9 percent this year to 3.3 percent in 2017 and reach 3.6 percent in 2018. The OECD stated that global growth will pick up faster than previously expected in the coming months as the Trump administration’s planned tax cuts and public spending fire up the US economy, revising up its forecasts. The Paris-based organization was slightly more optimistic about the US outlook, with a forecast for growth next year of 2.3 percent, up from 2.1 percent in its last set of estimates dating from September. US growth would pick up further in 2018 to reach 3.0 percent, the highest rate since 2005, as the incoming Trump administration cut taxes on business and households and embarked on an infrastructure investment program. That would in turn drive the unemployment rate in the world’s biggest economy down from 4.9 percent this year to 4.5 percent in 2018. As the US labor market becomes increasing tight and wages rise, the OECD forecast inflation would increase from 1.2 percent in 2016 to 2.2 percent in 2018, prompting the Federal Reserve to raise interest rates gradually to 2.0 percent by end-2018.

The Dow Jones Industrial Average lost 54.24 points or 0.28 percent to 19,097.90, Nasdaq was down 30.11 points or 0.56 percent to 5,368.81, while S&P 500 dropped 11.63 points or 0.53 percent to 2,201.72.

The Indian ADRs closed mostly in red; HDFC Bank was down 1.23%, Tata Motors was down by 0.70%, ICICI Bank was down 0.27% and Wipro was down 0.10%. On the other hand, Infosys was up 0.03%.


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MoneyWorks4Me is a SEBI-registered Investment Adviser (IA) dedicated to helping investors build long-term wealth through transparent, research-driven, conflict-free guidance. Founded in 2008, we started our journey as a Research Analyst (RA), providing deep fundamental analysis, intrinsic value insights, and long-term investing frameworks for Indian equities. In 2017, we transitioned to a full-fledged SEBI-registered Investment Adviser, strengthening our commitment to acting as a fiduciary—always putting the investor’s interest first.

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