The Markets (as of market close March 12, 2021)
Stocks opened last week mixed, as cyclicals and value stocks advanced, while tech
stocks plunged. The Dow (1.0%), the Global Dow (0.8%), and the Russell 2000 (0.5%)
posted moderate gains. The S&P 500 fell 0.5%. The Nasdaq dove into correction
territory after dropping 2.4% on the day and is down 11.0% from its all-time high. The
Nasdaq sits at its lowest level since November 2020. Among the sectors, utilities,
materials, financials, industrials, and real estate rose, while information technology and
communication services sank. Treasury bond prices continued to slide last Monday,
driving yields higher. Crude oil prices fell, while the dollar advanced.
The market saw a resurgence last Tuesday, particularly tech stocks. The Nasdaq, up
3.7% on the day, enjoyed its biggest rally since November. Treasury yields, which had
been soaring, fell back, as did crude oil prices and the dollar. At least for the day,
investors moved back to growth shares, possibly targeting stocks that had been avoided
as overvalued. The Russell 2000 gained 1.9%, the S&P 500 advanced 1.4%, the Global
Dow advanced 0.4%, and the Dow inched up 0.1%. Consumer discretionary (3.8%) and
information technology (3.4%) led the sectors. Energy, which had been soaring,
Stocks continued to surge last Wednesday following passage of a $1.9 trillion fiscal
stimulus package, encouraging news on the vaccine front, and a lower-than-expected
increase in the Consumer Price Index. Other than tech shares, which dipped, pulling the
Nasdaq down 0.4%, the remaining benchmark indexes posted solid gains, led by the
Russell 2000 (1.8%), followed by the Dow (1.5%), the Global Dow (0.8%), and the S&P
500 (0.6%). The yield on 10-year Treasuries dropped for the second consecutive day,
the dollar weakened, while crude oil prices advanced. Energy, financials, industrials,
materials, and consumer staples each advanced more than 1.0%.
Investors, spurred on by President Biden’s signing of the $1.9 trillion stimulus package,
pushed both the S&P 500 and the Dow to record highs last Thursday. Tech shares
rallied as the Nasdaq continued to rebound. Among the sectors, information technology
climbed 2.1%, communication services advanced 1.8%, consumer discretionary jumped
1.6%, and real estate gained 1.5%. Treasury yields and crude oil prices rose, while the
Stocks closed generally higher last Friday as cyclicals and value stocks pushed higher,
while tech shares regressed. The Dow advanced 0.9%, adding to its record high
achieved earlier in the week. The Russell 2000 gained 0.6%, the Global Dow climbed
0.5%, and the S&P 500 eked out a 0.1% gain. The Nasdaq pulled back, falling 0.6% on
the day. Advances in financials, industrials, and real estate offset downturns in
communication services and information technology. The yield on 10-year Treasuries
jumped 7.1% as bond prices sank. The dollar inched ahead, while crude oil prices
Investors generally preferred cyclicals and value stocks over tech shares last week.
Nevertheless, stocks ended the week higher, with each of the benchmark indexes
gaining at least 2.5%, led by the Russell 2000, followed by the Dow, the Global Dow,
the Nasdaq, and the S&P 500. Year to date, the Russell 2000 is up nearly 20.0%, and
the Global Dow is more than 10.0% ahead of its 2020 closing value. A sell-off of tech
stocks has kept the Nasdaq somewhat in check. Among the sectors, real estate and
consumer discretionary each gained 5.7% for the week, while both utilities and
materials advanced 4.4%. Crude oil prices and the dollar pulled back a bit, while gold
prices enjoyed a weekly advance for the first time in nearly a month.
The national average retail price for regular gasoline was $2.771 per gallon on March 8,
$0.060 per gallon more than the prior week’s price and $0.396 higher than a year ago.
During the week ended March 5, crude oil refinery inputs averaged 12.3 million barrels
per day, which was 2.4 million barrels per day more than the previous week’s average.
Refineries operated at 69.0% of their operable capacity last week, down from the prior
week’s rate of 73.0%. Click here for full articlemarket-flash 3-15-2021
Thomas Saunders is the Managing Partner of Winthrop Partners. Prior to founding Winthrop Partners, Tom was Senior Vice President at what is now JP Morgan. His career includes senior and executive roles at Brown Brothers Harriman and First Niagara Bank, a top 25 Bank. Click here to contact Thomas Saunders about your investment and planning requirements.