Weekly Investment Update

US equity indices advanced last week, with the S&P 500 ending at a new all-time closing high[1]. The increase is likely attributable to a combination of positive events, such as progress toward additional government stimulus, continued roll-out of COVID-19 vaccines, and better-than-expected fourth quarter results from S&P 500 companies.

The chart below shows the year-over-year percentage change of various consumer activities. This information is gathered and reported quickly, providing a nearly real-time window into a key driver of the economy (household confidence and spending). As the pandemic took hold in the US last March, there was a sharp decline in consumer activity, but mortgage applications and credit card transactions recovered to pre-pandemic levels fairly quickly as low mortgage rates spurred demand and consumers shifted to online shopping (e-commerce). However, in-person venues like hotels, travel, and dining remain significantly lower than a year ago. These indicators have started to trend upward again, potentially implying renewed optimism among households and another step on the path back to normalcy.

US Treasury Interest Rates

Graph depicting the annual change in consumer activity from February 2020 to January 2021

Source: JPMorgan Guide to the Markets as of February 11, 2021

Key Economic Releases This Week

Day Report Period Consensus Est. Previous
Wed., Feb. 17 Retail Sales January 1.0% -0.7%
Wed., Feb. 17 NAHB Housing Market Index February 83 83
Wed., Feb. 17 Producer Price Index (annual rate) January 0.9% 0.4%
Thursday, Feb. 18 Housing Starts (annual rate) January 1.66 million 1.67 million
Thursday, Feb. 18 Building Permits (annual rate) January 1.68 million 1.70 million
Source: Bloomberg

Asset Class Returns

Category Representative Index YTD 2021 Full Year 2020
Global Equity MSCI All-Country World 5.7% 16.3%
US Large Cap Equity  S&P 500  4.9% 18.4%
US Small Cap Equity  Russell 2000 16.0% 20.0%
Foreign Developed Equity MSCI EAFE 3.5% 7.8%
Emerging Market Equity MSCI Emerging Markets 10.8% 18.3%
US High Yield Fixed Income ICE BofAML High Yield Bond 1.4% 6.2%
US Fixed Income Bloomberg Barclays US Aggregate Bond -1.2% 7.5%
Cash Equivalents ICE BofAML 0-3 Mo Deposit 0.0% 0.5%
Source: Morningstar as of February 12, 2021

Prices & Interest Rates

Representative Index Current Year-End 2020
S&P 500 3,935 3,749
Dow Jones Industrial Avg. 31,458 30,497
NASDAQ 14,095 12,886
Crude Oil (US WTI) $60.58 $48.52
Gold $1,818 $1,893
US Dollar 90.48 89.94
2 Year Treasury 0.11% 0.13%
10 Year Treasury 1.20% 0.93%
30 Year Treasury 2.01% 1.65%
Source: Bloomberg, US Treasury as of February 12, 2021

[1] Source: Morningstar

Past performance may not be representative of future results.  All investments are subject to loss.  Forecasts regarding the market or economy are subject to a wide range of possible outcomes.  The views presented in this market update may prove to be inaccurate for a variety of factors.  These views are as of the date listed above and are subject to change based on changes in fundamental economic or market-related data.  Please contact your Financial Advisor in order to complete an updated risk assessment to ensure that your investment allocation is appropriate.   

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