US Household Wealth Tops $108-T in Q-1

US Household Wealth Tops $108-T in Q-1

$DIA, $SPY, $SOX, $QQQ, $RUTX, $VXX

US household wealth marked a record in Q-1 as the stock market rallied, supporting consumers after Fed interest-rate hikes and trade dispute shocked investors late last year.

Net worth for households and non-profit groups increased by $4.69-T, or 4.5%, to $108.6-T after a 3.7% drop in the prior frame, Federal Reserve data showed Thursday.

Household debt growth slowed to a 2.3% annual pace, the least since late Y 2015, from a 2.8% rate in Q-4 Y 2018

Key Insights

  • Wealth rebounded along with US stocks, which rallied in Q-1 by the most since Y 2009 on the Fed signaling it will hold off on raising interest rates and signs the trade dispute was cooling. President Trump has since reignited tensions, whipsawing markets even as gauges of consumer sentiment and confidence hold up.
  • The value of stocks and bonds directly and indirectly held by households and non-profit groups increased $3.23-T from the prior Quarter while the value of real estate rose by $387-B
  • Corporate debt growth picked up to 7.6%, the fastest pace in three years and more than 2X the prior frame. Fed Chairman Powell said last month that “we take the risks from business debt seriously but think that the financial system appears strong enough to handle potential losses.”
  • Non-mortgage consumer credit increased at a 4.3% pace, slower than the 2 prior Qs, but still signaling Americans are willing to borrow as interest rates remain relatively low.
  • Federal government debt rose at an 8.6% annual rate, the 2nd-fastest of President Trump’s tenure, after 2.5% in the previous Quarter. State and local government debt saw a 5th-straight contraction, falling 0.8%.

Thursday, the major US stock market indexes finished at: DJIA +181.09 at 25720.66, NAS Comp +40.08 at 7615.53, S&P 500 +17.34 at 2843.49

Volume: Trade on the NYSE came in at 791-M/shares exchanged

  • NAS Comp +14.8% YTD
  • S&P 500 +13.4% YTD
  • Russell 2000 +11.5% YTD
  • DJIA +10.3% YTD

HeffX-LTN’s overall technical outlook for the major US stock market indexes is Bullish in here.

Stay tuned.

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