Market Summary
May 2014

Depending on the Index you follow, the markets in April were once again flat to negative.


This has pretty much been the story for 2014 so far, albeit with some volatility mixed in.


The U.S. Bureau of Economic Analysis reported that 1st quarter GDP came in at a very weak 0.1%.  As a comparison, the 4th quarter of 2013 GDP grew by 2.6%. (Source:  U.S. Bureau of Economic Analysis, April 30, 2014) 



In order to officially be labeled "in a recession", GDP must come in negative for 2 consecutive quarters.  A 0.1% number, while not negative, is cutting it VERY CLOSE to falling back into the negative growth area, so many of us are going to be keeping our eye on the next quarter to see if the weather truly hampered us in the beginning of the year or we are beginning a trend lower once again in GDP.


The markets have gone well over a year without a correction of 10% or greater now.  In our opinion, this is because of the Fed's involvement.  In fact, if one goes back to 2009, it's obvious that the market's pullbacks have occurred when Fed stimulus programs have expired.

Our Management Philosophy

Limit downside risk and provide clients a reasonable rate of return over a market cycle.


With over five decades of combined money management experience in South Texas, you can be sure that Walter and Anthony Reyna have seen it all. This father-son pair built and developed Walter J. Reyna Inc. on the importance of hard work and strategic planning and continue to implement these core values in their business today.


The Reynas believe that wealth accumulation and protection are the result of exceptional planning, not luck. Visit our website to learn more.


Walter J. Reyna, Inc.
5315 North McColl Road
McAllen, Texas 78504 

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Market Summary Continued


Looking forward, the Fed once again voted to reduce their stimulus by another $10 billion dollars starting in May.  This will bring the total stimulus to $45 billion, down from its peak of $85 billion last year.  Also, over the course of the last few months, the growth sector, which led the markets last year, have broken down, with many big names down 20% or more so far this year.  It would appear that a convergence of these factors could be setting us up finally for a correction of some sort.


As we have lightened up on our growth oriented holdings, we believe that opportunity may start presenting itself overseas.  The divergence in the U.S. stock market and the European stock markets has widened drastically over the last couple years.  Europe is now talking stimulus (sound familiar), which could put it on the verge of an upward trend, much like the U.S. the last couple years.  From a technical perspective, we believe that this divergence in markets will eventually resort back to the mean, with both markets running more closely in tandem, historically speaking.


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For more information about your portfolio performance, please refer to your personalized statements or contact us. Regulatory restrictions prevent us from reporting personalized performance data in this newsletter. See below for important disclosures. 

Portfolio Insights
(1)The S&P 500 Index is representative of domestic markets and includes the average performance of 500 widely held common stocks.  Individuals cannot invest directly in any index and unlike investments; the S&P 500 Index does not incur management fees, charges, or expenses. (2) All Statistical information, investment category determinations, and economic data retrieved from Past performance is no guarantee of future results and all investment strategies involve the risk of financial loss. 


This publication is proprietary and limited to the sole use of Walter J. Reyna, Inc. clients.  Client portfolios are designed for the moderate investor but are actively managed on a monthly basis and may not follow traditional risk adjusted asset allocation models. Walter J. Reyna, Inc. maintains full discretion over said accounts and manages as deemed necessary. Clients with questions about the fees associated with their discretionary advisory account should refer to their advisory agreement. The information contained herein is for illustration purposes only. It is not necessarily complete, does not include client directed investments, and its accuracy is not guaranteed by Walter J. Reyna, Inc.  All clients should reference their periodic statements for accuracy. All clients needing additional information about holdings in the portfolio, including the objectives, risks, asset class and costs associated should refer to their respective prospectus. If you have received this communication in error, please notify us immediately by e-mail or telephone.  Neither the information, nor any opinion expressed constitutes a solicitation nor investment advice, for the purchase of any future security referred to in the Advisory Newsletter.  Investments offered through Registered Representatives of Lincoln Financial  Securities Corporation, member SIPC.  Lincoln Financial Securities Corporation and Walter J. Reyna, Inc. are not affiliated.