before the bell...2020/09/03 · the sharp rise in big tech stocks has put the nasdaq composite on...

FOR IMPORTANT DISCLOSURES PLEASE SEE THE DISCLOSURE PAGES AT THE END OF THIS DOCUMENT Notations:

• For further information on any of the topics mentioned, please contact your Financial Advisor. • Unless specifically stated otherwise, comments contained in this document should not be construed as an investment opinion or

recommendation of any securities mentioned. Charts depicted are from FactSet unless otherwise noted. ____________________________________________________________________________________________________________________________ © 2020 Ameriprise Financial, Inc. All rights reserved. of 12

Before the Bell Morning Market Brief

September 3, 2020

MORNING MARKET COMMENTARY: Anthony M. Saglimbene, Global Market Strategist

• Quick Take: U.S. futures are pointing to a flat open; European markets are trading in the green; Asia ended mixed overnight; West Texas Intermediate (WTI) oil trading up to $40.75; 10-year U.S. Treasury yield at 0.65%.

• The Market Is Overbought, in our view — But That Doesn't Seem To Matter At The Moment: Stocks continue

to soar higher in a near uninterrupted fashion. Since late August, the major U.S. averages have recorded new all-time highs almost daily. The sharp rise in Big Tech stocks has put the NASDAQ Composite on pace for its sixth straight week of gains and a string of S&P 500 record highs, which until recently, couldn't break through its previous record levels.

• Tuesday's ISM report showed manufacturing activity rebounded sharply from the depths of the pandemic lows, and in our view, should continue to show strength as inventories are restocked to meet recovering demand. Further, economic data, on the whole, continues to improve, which has added a layer of additional support for asset prices above and beyond the extraordinary monetary/fiscal accommodation pulsing through the U.S. today.

• Friday's August nonfarm payrolls report will be yet another opportunity for investors to measure the pulse of the recovery and decide if asset prices justify today's loftier stock valuations. Over recent weeks, we believe the market has increasingly taken the view that with each passing day, the world continues to recover. Therefore, stock prices should reflect the better tomorrow today. And we largely agree with that view.

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The S&P 500 is now in an overbought condition YTD

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Before The Bell September 3, 2020 ____________________________________________________________________________________________________________________________

____________________________________________________________________________________________________________________________ © 2020 Ameriprise Financial, Inc. All rights reserved. of 12

• But that's not to say stock prices can't get ahead of themselves from time-to-time. As the first FactSet chart above shows, the S&P 500's relative strength index (measured over the last 14 days) is in a condition that should give tactical investors some near-term pause, in our view. Stocks have primarily taken a one-way ride higher since late June and have not had a chance to consolidate their rapid gains. History tends to show that stocks can face some near-term pressures, at some point, when the RSI stays in what is percieved to be an “overbought” condition (above the 70 threshold) for an extended period. With that said, a flat market environment for a couple of weeks or so could help alleviate overbought conditions across the S&P 500.

'01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '208

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Stock valuations are elevated 20-Year

S&P 500 - PE - NTM S&P 500 - PE - LTM

• While we hesitate to make too much of the second FactSet chart above, given price-to-earnings (P/E) ratios are a better reflection of longer-term value than informing momentum over the near-term — they are elevated nevertheless. Here, we believe investors are pricing stocks on normalized earnings in 2021 and 2022, and where the P/E would appear less aggressive. However, S&P 500 companies, especially the largest constituents, already have a lot of "good expectations" priced in and relative to historical P/E averages. Time will tell if earnings can grow into current prices, but investors already assume they will, based on where P/E levels stand today — which again argues for some near-term caution, in our view.

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The number of S&P 500 stocks trading above their 50-day moving average is elevated 2-Year

S&P 500 - % of Fund/Index above Moving Average



• Further, roughly 83% of S&P 500 stocks are trading above their 50-day moving average, according to the third FactSet chart above. In our view, this is a short-term signal that buying activity has been more aggressive as of late. We noted on Tuesday that the level of put protection in the market is at a ten-year low — also signaling traders may be too complacent on future volatility. An upcoming bitter election battle being just one potential catalyst for a bout of sudden volatility.

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S&P 500 - Advance/Decline Line

• While the S&P 500's advance/decline line has steadily risen since late March, the fourth FactSet chart above shows the A/D line consistently stalled in late May and June, foreshadowing a more difficult stretch for the stock market in June. We are monitoring how many stocks are rising versus falling each day and as an indicator of overall breadth/strength across the market. Usually, when more stocks start to fall versus rising consistently, it can act as an early warning sign of near-term volatility for the overall market.

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First reported case ofcoronavirus in the U.S.

Money market assets continue to come off record levels

ICI, Money Market Mutual Fund Assets, All Funds, Mil USD - United States



• Here's the good news, though — there is a ton of cash on the sidelines that is looking for an opportunity to be put to work, as the last FactSet chart above demonstrates. As we also mentioned on Tuesday, don't underestimate TINA (There Is No Alternative). We believe any near-term pullback in the market could be eventually greeted with buyers given the low interest rate environment, extreme monetary/fiscal accommodation, as well as the thirst for yield and growth. In a world starved for growth, high-quality businesses that generate cash flow, have competitive advantages, generate income, or have some combination of the three should continue to perform well in the coming quarters barring an unexpected downshift in the economy. Investors should keep this point in mind, even if near-term overbought conditions start to create a headwind for stock prices.

• Asia-Pacific: Asian equities finished mixed on Thursday. Bloomberg noted the Trump administration is weighing the scope and effective date on its ban on Chinese social media apps WeChat and TikTok. The administration could make its decision public later this month. As a result, the U.S. Commerce Department is drafting documents to clarify specific transactions that will be prohibited between U.S. and Chinese companies.

• In a related note, Reuters discussed prospective buyers of TikTok's U.S. operations are exploring four options to structure a deal. They include buying the app's U.S. assets without critical software, asking for Beijing's approval to acquire TikToks' algorithm, licensing the algorithm from ByteDance, or seeking a transition period where U.S. national security interests can be dealt with over time.

• Bloomberg Economics noted that if the U.S. and China were to decouple, defined by ending the flow of trade and technology, China's potential GDP growth rate could fall to +3.5% annually by 2030 — a full percentage point below its current estimate. Notably, the impact would be felt more aggressively on China, as it relies more heavily on cross-border trade and innovation from the U.S. Conversely, U.S. potential growth by 2030 could slip to +1.4% annually, versus its current forecast of +1.6%. But as Bloomberg pointed out, China has significantly narrowed its technology gap over the last 20 years, and such a decoupling scenario would unlikely be catastrophic for China.

• Europe: Most markets across the region are trading in the green at midday. Some mixed services PMI data for August still shows Europe's economy, on the whole, is recovering from the depths of its lockdown in March and April. Eurozone final services August PMI was revised modestly higher based on better data out of Germany, while the U.K. saw its services activity for the month revised modestly lower. Services activity across Europe remained in expansionary mode, though somewhat weaker compared to July's massive push higher.

• U.S.: Equity futures are pointing to a mixed open. Here is a quick news rundown to start your morning: The CDC says health officials should prepare for a coronavirus vaccine soon. According to The New York

Times, health officials around the country should be ready to distribute a vaccine as soon as late October or early November to high-risk groups and healthcare professionals. This syncs up with comments from infectious disease Dr. Anthony Fauci and FDA Chairman Dr. Stephen Hahn stating a vaccine could be available to certain groups by year-end. Vaccine optimism has been an essential catalyst in lifting stock prices and investor sentiment over recent weeks and months, in our view.

The Fed is letting the market know it will be flexible on inflation. Following Federal Reserve Chair Jerome Powell's speech at Jackson Hole last Thursday outlining the Fed's shift toward a flexible average inflation target, other members are reiterating the new approach. Several speeches from Fed members this week have touched on an accommodative approach over the coming months, inflation overshoots on the 2% target, and low unemployment alone, not triggering a more hawkish monetary stance.



WORLD CAPITAL MARKETS 9/3/2020 As of: 8:30 AM ET

Americas % chg. % YTD Value Europe (Intra-day) % chg. %YTD Value Asia/Pacific (Last Night) % chg. %YTD ValueS&P 500 1.54% 12.30% 3,580.8 DJSTOXX 50 (Europe) 1.09% -7.73% 3,374.0 Nikkei 225 (Japan) 0.94% 0.39% 23,465.5 Dow Jones 1.59% 3.72% 29,100.5 FTSE 100 (U.K.) 0.49% -18.72% 5,970.2 Hang Seng (Hong Kong) -0.45% -8.76% 25,007.6 NASDAQ Composite 0.98% 35.32% 12,056.4 DAX Index (Germany) 0.93% 0.88% 13,366.1 Korea Kospi 100 1.33% 9.52% 2,395.9 Russell 2000 0.87% -3.69% 1,592.3 CAC 40 (France) 1.58% -12.82% 5,111.4 Singapore STI -0.32% -18.58% 2,531.8 Brazil Bovespa -0.25% -11.88% 101,911 FTSE MIB (Italy) 0.62% -15.00% 19,981.5 Shanghai Comp. (China) -0.58% 10.98% 3,385.0 S&P/TSX Comp. (Canada) 0.32% 0.07% 16,698.0 IBEX 35 (Spain) 1.68% -23.72% 7,114.7 Bombay Sensex (India) -0.24% -4.54% 38,990.9 Mexico IPC -1.16% -13.93% 37,053.8 MOEX Index (Russia) -0.67% 0.26% 2,936.8 S&P/ASX 200 (Australia) 0.81% -5.74% 6,112.6

Global % chg. % YTD Value Developed International % chg. %YTD Value Emerging International % chg. %YTD ValueMSCI All-Country World Idx 0.94% 6.83% 594.1 MSCI EAFE 0.53% -4.01% 1,913.0 MSCI Emerging Mkts -0.10% 2.28% 1,118.9 Note: International market returns shown on a local currency basis. The equity index data shown above is on a total return basis, inclusive of dividends.

S&P 500 Sectors % chg. % YTD Value Commodities Communication Services 2.19% 19.89% 215.8 Equity Income Indices % chg. % YTD Value Futures & Spot (Intra-day) % chg. % YTD ValueConsumer Discretionary 1.24% 31.07% 1,283.3 JPM Alerian MLP Index -0.66% -43.44% 123.4 CRB Raw Industrials -0.05% 0.02% 451.86 Consumer Staples 1.90% 7.81% 685.0 FTSE NAREIT Comp. TR 2.02% -8.10% 19,622.5 NYMEX WTI Crude (p/bbl.) -2.05% -33.41% 40.66 Energy -0.42% -40.07% 263.0 DJ US Select Dividend 2.04% -16.26% 1,917.8 ICE Brent Crude (p/bbl.) -2.03% -34.05% 43.53 Financials 1.50% -15.95% 422.7 DJ Global Select Dividend 0.14% -19.31% 183.7 NYMEX Nat Gas (mmBtu) 0.88% 14.57% 2.51 Health Care 2.09% 8.49% 1,273.6 S&P Div. Aristocrats 1.92% 1.20% 3,104.5 Spot Gold (troy oz.) -0.66% 27.21% 1,930.10 Industrials 1.63% -0.73% 673.3 Spot Silver (troy oz.) -1.97% 50.72% 26.91 Materials 2.28% 9.48% 415.9 LME Copper (per ton) 0.01% 9.12% 6,709.75 Real Estate 2.24% -2.85% 229.3 Bond Indices % chg. % YTD Value LME Aluminum (per ton) -1.82% -1.81% 1,749.00 Technology 0.92% 39.81% 2,232.9 Barclays US Agg. Bond 0.21% 7.27% 2,386.8 CBOT Corn (cents p/bushel) -0.28% -11.12% 357.75 Utilities 3.12% -4.91% 305.3 Barclays HY Bond 0.16% 1.92% 2,224.7 CBOT Wheat (cents p/bushel) 0.04% -3.33% 558.50

Foreign Exchange (Intra-day) % chg. % YTD Value % chg. % YTD Value % chg. % YTD ValueEuro (€/$) -0.36% 5.34% 1.18 Japanese Yen ($/¥) -0.33% 1.95% 106.53 Canadian Dollar ($/C$) -0.55% -0.97% 1.31British Pound (£/$) -0.77% -0.08% 1.32 Australian Dollar (A$/$) -0.75% 3.73% 0.73 Swiss Franc ($/CHF) -0.16% 5.96% 0.91Data/Price Source: Bloomberg. Equity Index data is total return, inclusive of dividends, where applicable.

Ameriprise Global Asset Allocation Committee U.S. Equity Sector - Tactical View

S&P 500 GAAC GAAC S&P 500 GAAC GAACIndex GAAC Tactical Recommended Index GAAC Tactical Recommended

Sector Weight Tactical View Overlay Weight Sector Weight Tactical View Overlay Weight

1) Communication Services 10.9% Underweight - 2.0% 8.9% 6) Health Care 14.6% Overweight +2.0% 16.6%

2) Consumer Discretionary 10.8% Overweight +2.0% 12.8% 7) Industrials 8.0% Overweight +2.0% 10.0%

3) Consumer Staples 7.0% Underweight - 2.0% 5.0% 8) Information Technology 27.1% Overweight +2.0% 29.1%

4) Energy 2.9% Equalweight - 2.9% 9) Materials 2.5% Equalweight - 2.5%

5) Financials 10.3% Underweight - 2.0% 8.3% 10) Real Estate 2.8% Equalweight - 2.8%

11) Utilities 3.1% Underweight - 2.0% 1.1%As of: July 1 , 2020

Ameriprise Global Asset Allocation Committee Global Equity Region - Tactical View

MSCI All-Country GAAC GAAC MSCI All-Country GAAC GAACWorld Index GAAC Tactical Recommended World Index GAAC Tactical Recommended

Region Weight Tactical View Overlay Weight Region Weight Tactical View Overlay Weight

1) United States 56.0% Overweight +5.1% 61.1% 5) Latin America 1.0% Equalweight - 1.0%

2) Canada 2.7% Equalweight - 2.7% 6) Asia-Pacific ex Japan 14.7% Overweight +2.0% 16.7%

3) United Kingdom 3.9% Underweight - 2.0% 1.9% 7) Japan 7.0% Underweight - 2.0% 5.0%

4) Europe ex U.K. 13.6% Underweight - 2.0% 11.6% 8) Middle East / Africa 1.1% Underweight - 1.1% -

As of July 1, 2020



BY THE NUMBERS: ECONOMIC ACTUALS AND FORECAST:

ECONOMIC NEWS OUT TODAY: Economic Releases for Thursday, September 3, 2020. All times Eastern. Consensus estimates via Bloomberg. Time Period Release Consensus Est. Actual Prior Revised to 8:30 AM Aug. 29 Initial Jobless Claims 950k 881k 1006k 1011k 8:30 AM Aug. 22 Continuing Claims 14000k 13254k 14535k 14492k 8:30 AM Q2 F Q2 Nonfarm Productivity 7.5% +10.1% 7.3% 8:30 AM Q2 F Q2 Unit Labor Costs 12.0% +9.0% 12.2% 8:30 AM JUL Trade Balance -$58.0B -$63.6 -$50.7B -$53.5 10:00 AM AUG ISM Services Index 57.0 58.1 Economic Perspective: Russell T. Price, CFA – Chief Economist • Good news and bad news on the economic front this morning. Financial markets will likely focus on the larger than

expected declines in new and continuing unemployment claims. The sharp jump in the Trade Deficit, however, is a direct negative that will likely trim GDP forecasts for Q3 somewhat. The Trade Balance jump should be a relatively temporary situation, however, and the further decline in unemployment is truly the over-riding positive, in our view.

• Unemployment benefit rolls improve considerably. The 1.24 million week-over-week drop in continuing claims was the largest decline for the series since the week-ended May 15th. Note that the data on continuing claims lags that of initial claims by one week. Today’s measurement week was also the survey week for tomorrow’s Employment Report and the data could influence the unemployment rate results. The chart at right has been updated for today’s release and is sourced from FactSet.

Current Projections:Actual Actual Actual Actual Est. Est. Actual Actual Actual Est. Est.2016 2017 2018 2019 2020 2021 Q4-2019 Q1-2020 Q2-2020 Q3-2020 Q4-2020

Real GDP (YOY) 1.7% 2.3% 3.0% 2.2% -4.1% 3.8% 2.1% -5.0% -31.7% 26.6% 4.4%Unemployment Rate 4.7% 4.1% 3.9% 3.5% 9.0% 6.0% 3.5% 4.4% 11.1% 10.0% 9.0%CPI (YoY) 1.3% 2.1% 2.4% 1.8% 1.0% 2.1% 2.0% 2.1% 0.4% 0.8% 0.8%Core PCE (YoY) 1.6% 1.6% 2.0% 1.6% 1.1% 1.5% 1.6% 1.7% 0.9% 1.1% 1.1%

Sources: Historical data via FactSet. Estimates (Est.) via American Enterprise Investment Services, Inc.

YoY = Year-over-year, Unemployment numbers are period ending. GDP: Gross Domestic Product; CPI: Consumer Price Index

PCE: Personal Consumption Expenditures Price Index. Core excludes food and energy.

Please note: Due to the very dynamic nature of current economic conditions, economic forecasts may change measurably and quickly.

Last Updated:

Full Year Quarterly

August 28, 2020



• Government debt projections surge, but lower interest expense is expected to help helps contain projections beyond 2020, according to latest CBO outlook. As previously indicated in its April outlook update, the Congressional Budget Office (CBO) projects U.S. government debt outstanding will exceed the size of the underlying economy within the next few months. This is, however, a modest improvement to their previously issued outlook. CBO now says government debt to GDP will end the current fiscal year (the end of this month) at 98.1% of GDP, as opposed to their April forecast of a 101% fiscal year-ending level. The current projections have debt to GDP exceeding its prior all-time high of 106% as attained in 1946, by 2023. The three graphics associated with this commentary are each sourced from the CBO – publication #56517.

• Yesterday’s update from the CBO, however, offered a surprisingly large positive revision relative to government interest expense over the next 10 years. As seen in the chart below, lower interest rates are expected to result in lower overall interest expense over the 2021 to 2030 period, despite the higher dollar value of debt outstanding. Lower inflation projections are also expected to help by reducing annual cost of living adjustments for various programs such as Social Security.

• The Federal Reserve’s increased ownership of federal debt is also taken into consideration. According to the CBO, government debt-to-GDP net of financial assets and Federal Reserve Treasury debt holdings (which are essentially interest free) was 61% at the end of 2019 and will rise to 80% by the end of 2030.



•

FIXED INCOME NEWS & VIEWS: Brian M. Erickson, CFA, Fixed Income Research & Strategy U.S. Debt to GDP to Exceed 100% in 2021 • According to the Congressional Budget Office (CBO), the U.S. federal debt to GDP will rise above 100% next year as

federal government deficits add to the national debt. The CBO’s latest projection show debt to GDP to end 2020, reaching 98%, compared to 79% at the end of last year and just 35% in 2007. Congress’ response since the financial crisis aided the recovery but lacked a mechanism to raise revenues or cut costs to reset our nation’s financial flexibility. The CBO’s 2020-2030 forecast period shows a cumulative $13 trillion of deficit spending. By 2023, the CBO projects debt to GDP to top 107%, surpassing the previous record seen at the end of World War II.

• Credit perspective: The credit perspective takes the position of a U.S. Treasury investor, looking at the risk of not receiving timely interest and principal payments. Amid a global pandemic, we believe the flexibility of expanding federal debt to contain potential damage to the economy is warranted. The concern voiced by Moody’s Investor Service and Fitch Ratings centers on the lack of a plan for lowering debt levels in the medium term. While additional spending remains prudent in the short-term, Congress will need to consider mechanisms to close deficits in the medium term or potentially face further downgrades. In the near-term, we believe the greater credit risk is fostering a recovery, but a return to balanced budgets and more reasonable debt levels should be a part of the discussion.

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Lyle B. Schonberger - Vice President Business Unit Compliance Liaison (BUCL) Jeff Carlson, CLU, ChFC – Sr. Manager Investment Research Coordinator Kimberly K. Shores Sr. Administrative Assistant Jillian Willis STRATEGISTS Chief Market Strategist David M. Joy – Vice President Global Market Strategist Anthony M. Saglimbene – Vice President

Thomas Crandall, CFA, CMT, CAIA – Sr. Director, Asset Allocation Cedric Buermann Jr., CFA – Analyst – Quantitative, Asset Allocation

Gaurav Sawhney – Research Analyst

Amit Tiwari – Sr. Research Associate Chief Economist Russell T. Price, CFA – Vice President Retirement Research Jay C. Untiedt, CFA, CAIA, RICP – Vice President EQUITY RESEARCH Equity Research Director Justin H. Burgin – Vice President

Consumer Goods and Services Patrick S. Diedrickson, CFA – Director

Energy/Utilities William Foley, ASIP – Director

Financial Services/REITs Lori Wilking-Przekop – Sr Director

Health Care Daniel Garofalo – Director

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Technology/Telecommunication Open

MANAGER RESEARCH

Michael V. Jastrow, CFA – Vice President

Mark Phelps, CFA – Director – Multi-Asset Solutions ETFs, CEFs, UITs Jeffrey R. Lindell, CFA – Director

James P. Johnson, CFA, CFP® – Sr Analyst Alternatives Justin E. Bell, CFA – Vice President – Head of Quantitative Research and Alternatives

Kay S. Nachampassak – Director - Alternatives Quantitative Research Kurt J. Merkle, CFA, CFP®, CAIA – Sr Director

Peter W. LaFontaine – Sr Analyst

David Hauge, CFA – Analyst

Blake Hockert – Sr Associate

Bishnu Dhar – Sr Research Analyst

Parveen Vedi – Sr Research Associate

Darakshan Ali – Research Process Trainee Equities Christine A. Pederson, CAIA, CIMA – Sr Director – Growth Equity, Infrastructure & REIT

Benjamin L. Becker, CFA – Director – International/Global Equity

Cynthia Tupy, CFA – Director – Value and Equity Income Equity

Alex Zachman, CFA – Analyst – Core Equity Fixed Income Steven T. Pope, CFA, CFP® – Sr Director – Non-Core Fixed Income

Douglas D. Noah, CFA – Sr Analyst – Core Taxable & Tax-Exempt Fixed Income

FIXED INCOME RESEARCH & STRATEGY

Fixed Income Research Brian M. Erickson, CFA – Vice President High Yield and Investment Grade Credit Jon Kyle Cartwright – Sr. Director

Stephen Tufo – Director

RETIREMENT RESEARCH

Jay C. Untiedt, CFA, CAIA, RICP – Vice President

Nidhi Khandelwal – Director

Matt Morgan – Sr. Manager



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All fixed income securities are subject to a series of risks which may include, but are not limited to: interest rate risk, call risk, refunding risk, default risk, inflations risk, liquidity risk and event risk. Please review these risks with your financial advisor to better understand how these risks may affect your investment choices. In general, bond prices rise when interest rates fall and vice versa. This effect is usually more pronounced for longer-term securities. This means you may lose money if you sell a bond prior to maturity as a result of interest rate or other market movement. Any information relating to the income or capital gains tax treatment of financial instruments or strategies discussed herein is not intended to provide specific tax advice or to be used by anyone to provide tax advice. Investors are urged to seek tax advice based on their particular circumstances from an independent tax professional. A real estate investment trust or REIT is a company that owns and operates income-producing real estate. In addition, some REITs participate in the financing of real estate. To qualify as a REIT, a company must: I) invest at least 75% of its total assets in real estate assets, II) generate at least 75% of its gross income from real property or interest, and III) pay at least 90% of its taxable income to shareholders in the form of distributions. A company that qualifies as a REIT is permitted to deduct the distributions paid to shareholders from its corporate taxes. Consequently, many REITs target to payout at least 100% of taxable income, resulting in virtually no corporate taxes. An investment in a REIT is subject to many of the same risks as a direct investment in real estate including, but not limited to: Illiquidity and valuation complexities, redemption restrictions, distribution and diversification limits, tax consequences, fees, defaults by borrowers or tenants, market saturation, balloon payments, refinancing, bankruptcy, decreases in market rates for rents and other economic, political, or regulatory occurrences affecting the real estate industry. Ratings are provided by Moody’s Investors Services and Standard & Poor’s. Non-Investment grade securities, commonly known as "high-yield" or "junk" bonds, are historically subject to greater risk of default, including the loss of principal and interest, than higher-rated bonds, which may result in greater price volatility than experienced with a higher-rated issue. Securities offered through AFSI may not be suitable for all investors. Consult with your financial advisor for more information regarding the suitability of a particular investment. For further information on fixed income securities please refer to FINRA’s Smart Bond Investing at FINRA.org, MSRB’s Electronic Municipal Market Access at emma.msrb.org, or Investing in Bonds at investinginbonds.com. Alternative investments cover a broad range of strategies and structures designed to be low or non-correlated to traditional equity and fixed-income markets with a long-term expectation of illiquidity. Alternative investments involve substantial risks

and are more volatile than traditional investments, making them more suitable for investors with an above-average tolerance for risk. Growth securities, at times, may not perform as well as value securities or the stock market in general and may be out of favor with investors. Value securities may be unprofitable if the market fails to recognize their intrinsic worth or the portfolio manager misgauged that worth. DEFINITIONS OF TERMS Agency – Agency bonds are issued by Government Sponsored Enterprises (GSE), but are NOT direct obligations of the U.S. government. Common GSE’s are the Federal Home Loan Mortgage Corp. (Freddie Mac) Federal National Mortgage Association (Fannie Mae) and Federal Home Loan Bank (FHLB). Beta: A measure of the risk arising from exposure to general market movements as opposed to company-specific factors. Betas in this report, unless otherwise noted, use the S&P 500 as the market benchmark and result from calculations over historic periods. A beta below 1.0, for example, can suggest the equity has tended to move with lower volatility than the broader market or, due to company-specific factors, has had higher volatility but generally low correlations with the overall market. Corporate Bonds – Are debt instruments issued by a private corporation. Non-Investment grade securities, commonly known as “high-yield” or “junk” bonds, are historically subject to greater risk of default, including the loss of principal and interest, than higher-rated bonds, which may result in greater price volatility than experienced with a higher-rated issue. Mortgage Backed Securities – Bonds are subject to prepayment risk. Yield and average lives shown consider prepayment assumptions that may not be met. Changes in payments may significantly affect yield and average life. Please contact your financial advisor for information on CMOs and how they react to different market conditions. Municipal Bonds – Interest income may be subject to state and/or local income taxes and/or the alternative minimum tax (AMT). Municipal securities subject to AMT assume a “nontaxable” status for yield calculations. Certain municipal bond income may be subject to federal income tax and are identified as “taxable”. Gains on sales/redemptions of municipal bonds may be taxed as capital gains. If the bonds are insured, the insurance pertains to the timely payment of principal (at maturity) and interest by the insurer of the underlying securities and not to the price of the bond, which will fluctuate prior to maturity. The guarantees are backed by the claims-paying ability of the listed insurance company. Treasury Securities – There is no guarantee as to the market value of these securities if they are sold prior to maturity or redemption. Price/Book: A financial ratio used to compare a company’s market share price, as of a certain date, to its book value per



share. Book value relates to the accounting value of assets and liabilities in a company’s balance sheet. It is generally not a direct reflection of future earnings prospects or hard to value intangibles, such as brand, that could help generate those earnings. Price/Earnings: An equity valuation multiple calculated by dividing the market share price, as of a certain date, by earnings per share. Trailing P/E uses the share price divided by the past four-quarters’ earnings per share. Forward P/E uses the share price as of a certain date divided by the consensus estimate of the future four-quarters’ EPS. Price/Sales: An equity valuation multiple calculated by dividing the market share price, as of a certain date, by the company’s sales per share over the most recent year. INDEX DEFINITIONS An index is a statistical composite that is not managed. It is not possible to invest directly in an index. Definitions of individual indices mentioned in this report are available on our website at ameriprise.com/legal/disclosures in the Additional Ameriprise research disclosures section, or through your Ameriprise financial advisor. DISCLAIMER SECTION Except for the historical information contained herein, certain matters in this report are forward-looking statements or projections that are dependent upon certain risks and uncertainties, including but not limited to, such factors and considerations as general market volatility, global economic and geopolitical impacts, fiscal and monetary policy, liquidity, the level of interest rates, historical sector performance relationships as they relate to the business and economic cycle, consumer preferences, foreign currency exchange rates, litigation risk, competitive positioning, the ability to successfully integrate acquisitions, the ability to develop and commercialize new products and services, legislative risks, the pricing environment for products and services, and compliance with various local, state, and federal health care laws. See latest third-party research reports and updates for risks pertaining to a particular security. This summary is based upon financial information and statistical data obtained from sources deemed reliable, but in no way is warranted by Ameriprise Financial, Inc. as to accuracy or completeness. This is not a solicitation by Ameriprise Financial Services, LLC of any order to buy or sell securities. This summary is based exclusively on an analysis of general current market conditions, rather than the appropriateness of a specific proposed securities transaction. We will not advise you as to any change in figures or our views. Past performance is not a guarantee of future results. Investment products are not federally or FDIC-insured, are not deposits or obligations of, or guaranteed by any financial institution, and involve investment risks including possible loss of principal and fluctuation in value.

Ameriprise Financial Services, LLC and its affiliates do not offer tax or legal advice. Consumers should consult with their tax advisor or attorney regarding their specific situation. Ameriprise Financial Services, LLC. Member FINRA and SIPC.

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before the bell...2020/09/03 · the sharp rise in big tech stocks has put the nasdaq composite on...

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