(New York)

Dividend stocks have been an interesting case over the last few quarters. In the fourth quarter, when interest rates looked to be headed higher, they actually outperformed the market (counterintuitively). This year, as rates look to be headed lower, they have performed quite well (up 16%), but still lagged a bit behind the S&P 500. The question is where they go from here, and all signs point to higher given the prevailing rates environment and general anxiety. The trick is buying the right ones, as financials and healthcare offer better value than more traditional areas like utilities, real estate, and consumer staples.

FINSUM: We think these are good sector selections as they have not seen as much price inflation as the more common dividend choices. Healthcare seems particularly interesting given that it is quite recession-resistant.

(New York)

With markets at elevated levels, investors may be looking for a safety stock. How about one outside the usual suspects? Here is a suggestion—Goldman Sachs. Yes, we know, that sounds odd considering that investment banks tend to have wildly unpredictable earnings because of fluctuations in trading revenue. However, the bank has just made a big dividend boost from 85 cents to $1.25 per share, which is likely to significantly elevate its status with dividend-seeking investors. Goldman is also diversifying away from its highest risk businesses and smoothing out its revenue by focusing on a more steady Main Street-oriented suite of products.

FINSUM: We think the jury is still out on Goldman’s success at retail banking products. That said, the prevailing narrative about its transformation and the dividend boost will help it be less volatile.

(Houston)

Something very interesting is happening across commodities markets—they are rallying. The reason this is interesting is it is a broad-based rally, not just in a narrow safe haven like gold. Oil, a major barometer for growth, is also jumping. The reasons why are two-part. Firstly, the US and China seemed to ease trade tensions somewhat this week at the G20; but secondly, OPEC has said it is cutting oil output. Metals, grains, and emerging markets also rallied.

FINSUM: This makes sense because a de-escalation of the trade war would help the global economy. Further, a reduction in tariffs would simply make the flow of commodities and goods smoother once again.

(Washington)

In what comes as a real eye opener, the House passed a bill this week that would block the SEC’s ability to enforce its new fiduciary rule. The driving force behind the rule, you guessed it, Maxine Waters. The measure came as part of a broader bill regarding the funding of federal agencies. The bill now heads to the Senate, where it will likely be changed and then re-voted on. Democrats, who are in charge in the House, are worried the SEC’s rule does not go far enough to protect investors.

FINSUM: The interesting thing here is that this bill is likely not totally dead in the Senate. We wonder how hard the Democrats will stick to this part of it.

(New York)

The White House is considering a new plan to cut capital gains taxes. The administration is seeking to do so by indexing capital gains rates to inflation, a move that would significantly help wealthier Americans lower their tax bills. Interestingly, the White House is considering advancing the bill in such a way as to bypass Congress. The impetus for doing so is that they want to make sure the changes hit before the 2020 election.

FINSUM: This is quite logical and could have a big impact. Imagine you could exclude 2% of an annualized 8% gain from all capital gains taxes!