February 8, 2021

Weekly Investment Update

US stocks rose last week after declining in January. With the week’s gain of nearly 4.7 percent, the S&P 500 index is now positive for the year by 3.6 percent^[1]. Better-than-expected fourth quarter corporate earnings, the prospect of additional fiscal stimulus, and the rollout of COVID-19 vaccines are likely influencing investor optimism. These trends are also likely driving interest rates higher, which has challenged fixed income returns so far in 2021. The interest rate on 10-year US Treasury notes has been generally rising since August 2020, and returns on the broad bond market benchmark, the Bloomberg Barclays US Aggregate Bond index, have been declining as a result. Higher interest rates should be better for savers in the long-run, but the upward move in rates over the last several months has not been productive for existing holders of government debt.

US Treasury Interest Rates

Source: US Treasury

This week will be relatively quiet with respect to economic data, but investors will be watching continued signs of progress toward additional fiscal stimulus in the form of new relief from the COVID-19 pandemic, including direct payments to Americans. Several large consumer-oriented companies will also report their fourth quarter 2020 results, such as Toyota, General Motors, Coca-Cola, Pepsi, and Disney.

Key Economic Releases This Week

Day	Report	Period	Consensus Est.	Previous
Tuesday, Feb. 9	JOLTs Job Openings	December	6.50 million	6.53 million
Wed., Feb. 10	Core Consumer Price Index (year-over-year)	January	1.5%	1.6%
Thursday, Feb. 11	Initial Unemployment Claims	Week of 1/31/21	757,000	779,000
Thursday, Feb. 11	Continuing Unemployment Claims	Week of 1/24/21	4.49 million	4.59 million
Friday, Feb. 12	University of Michigan Consumer Sentiment	February (prelim)	80.8	79.0

Source: Bloomberg

Asset Class Returns

Category	Representative Index	YTD 2021	Full Year 2020
Global Equity	MSCI All-Country World	3.8%	16.3%
US Large Cap Equity	S&P 500	3.6%	18.4%
US Small Cap Equity	Russell 2000	13.1%	20.0%
Foreign Developed Equity	MSCI EAFE	1.7%	7.8%
Emerging Market Equity	MSCI Emerging Markets	8.2%	18.3%
US High Yield Fixed Income	ICE BofAML High Yield Bond	1.1%	6.2%
US Fixed Income	Bloomberg Barclays US Aggregate Bond	-1.1%	7.5%
Cash Equivalents	ICE BofAML 0-3 Mo Deposit	0.0%	0.5%

Source: Morningstar as of February 5, 2021

Prices & Interest Rates

Representative Index	Current	Year-End 2020
S&P 500	3,880	3,749
Dow Jones Industrial Avg.	31,042	30,497
NASDAQ	13,598	12,886
Crude Oil (US WTI)	$56.85	$48.52
Gold	$1,811	$1,893
US Dollar	91.53	89.94
2 Year Treasury	0.09%	0.13%
10 Year Treasury	1.19%	0.93%
30 Year Treasury	1.97%	1.65%

Source: Bloomberg, US Treasury as of February 5, 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.  