US Equity Markets succumbed to some modest profit-taking last week despite President-elect Biden's proposal for an additional $1.9 trillion in fiscal stimulus. The S&P 500 fell 1.5% for the week and is now only up 0.3% for the year. The Nasdaq also dropped 1.5% for the week and remains up 0.9% for the year, while improving economic hopes caused the Russell 2000 (small cap stocks) to continue to outperform notably, up 1.5% for the week to bring its gains for the year to 7.5%.
Global Equity Markets declined last week following a rise in COVID cases in China, which renewed some investor concerns about global growth prospects. Developed Markets were down 1.4% for the week to reduce its gains for the year to 1.8%. The ongoing decline in the US Dollar pushed Emerging Markets slightly higher for the week, up 0.3%, bringing their gains for the year to 5.2%.
Energy Prices have begun the year on a strong note. Oil prices closed last week at $52.04/barrel, up 7.3% for the year, on rising demand hopes and supply reductions out of Saudi Arabia and Russia. Natural gas prices are up 7.2% for the year thus far, in part due to predictions for a colder-than-normal winter that should spur demand.
Of Interest to Us
Despite forecasts for economic growth rising for 2021 on the backs of more fiscal stimulus, US Economic Data continue to show the impacts of the recent surge in COVID cases. Retail Sales for December fell for the third consecutive month, down 0.7% and worse than expected. Initial Weekly Jobless Claims spiked by 181K to 965K, and the NFIB Small Business Optimism indexed dropped sharply in December to its lowest reading since May on increasing state/local lockdowns. Things may indeed get worse before they get better.
Market Data
for the week ending 1/15/2021
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