Winthrop Partners Market and Economic Update Jun 28, 2021

The Markets (as of market close June 25, 2021)

Despite hawkish rhetoric from some high-ranking Federal Reserve officials, equities kicked off last week on an upswing, enjoying their biggest rally in several sessions. Energy, financials, and industrials helped push the S&P 500 up 1.4%. The Russell 2000 rebounded from a rough prior week, gaining 2.2%. The Dow gained 1.8%. The Global Dow climbed 1.0%, while the Nasdaq advanced 0.8%. Treasury yields and crude oil prices moved higher, while the dollar dipped.

The Nasdaq set a fresh record last Tuesday as stocks posted solid gains after Federal Reserve Chair Jerome Powell reiterated his views that inflationary pressures will prove to be transitory and that prices will eventually come down. Among the indexes, the Nasdaq climbed 0.8%, followed by the Global Dow (0.6%), the S&P 500 (0.5%), the Russell 2000 (0.4%), and the Dow (0.2%). The market sectors generally advanced, with the exception of real estate and utilities. Treasury yields, the dollar, and crude oil prices fell.

Last Wednesday stocks closed mixed, with the Russell 2000 (0.3%) and the Nasdaq (0.1%) posting modest gains, while the Dow (-0.2%), the S&P 500 (-0.1%), and the Global Dow (-0.1%) dipped lower. Unlike the previous day, 10-year Treasury yields, crude oil prices, and the dollar advanced. Consumer discretionary led the sectors, closing up 0.6%, while utilities, materials, and consumer staples declined.

Both the Nasdaq and the S&P 500 reached record highs last Thursday as strong economic reports and President Joe Biden’s bipartisan $579 billion infrastructure deal may have provided optimism to investors that the economy is pushing ahead. The Russell 2000 gained 1.2%, followed by the Dow (1.0%), the Global Dow (0.7%), the Nasdaq (0.7%), and the S&P 500 (0.6%). Financials, communication services, energy, and industrials led the market sectors. Treasury yields and the dollar dipped slightly, while crude oil prices increased marginally.

Stocks closed generally higher last Friday with only the Nasdaq falling minimally. Stocks tied to economic recovery (e.g., consumer staples and consumer discretionary) performed well. The Dow advanced 0.7%, the Global Dow climbed 0.6%, the S&P 500 gained 0.3%, and the Russell 2000 inched up 0.2%. Falling bond prices sent the yield on 10-year Treasuries up 3.3%. Crude oil prices gained nearly 1.0%, while the dollar was
essentially unchanged. The market sectors mostly advanced, led by financials and
utilities, while information technology fell 0.2%.

The week ended with each of the benchmark indexes posting gains. The small caps of
the Russell 2000 led the way, followed by the Dow, the S&P 500, the Global Dow, and the
Nasdaq. Year to date, the benchmark indexes listed here are well ahead of their 2020
closing values, with the Russell 2000 up more than 18.0% and the Global Dow ahead by
16.0%. Last week was also a positive one for the major market sectors. Energy (6.7%)
and financials (5.3%) gained the most, while utilities advanced less than 1.0%. Crude oil
prices continued to surge, increasing 3.6% for the week to nearly $74.00 per barrel.
Crude oil prices have risen 52.5% since the start of the year.

The national average retail price for regular gasoline was $3.060 per gallon on June 21,
$0.009 per gallon less than the prior week’s price but $0.931 higher than a year ago.
Gasoline production increased during the week of June 21, averaging 10.3 million
barrels per day, up from the prior week’s average of 9.9 million barrels per day. U.S.
crude oil refinery inputs averaged 16.1 million barrels per day during the week ended
June 18; this was 224,000 barrels per day less than the previous week’s average. For
the week ended June 18, refineries operated at 92.2% of their operable capacity, down
from the prior week’s level of 92.6%. Click here for full article: Winthrop Partner Market and Economic Update 6-28-21