In Markets "In a Nutshell"

Markets “In a Nutshell” for August 9, 2021

Investment Week at a Glance

Stocks finished higher for the week.  The Dow Jones Industrial Average rose 0.80%, the S&P 500 was up 0.90%, and the NASDAQ rose 1.10%.  Foreign stocks (MSCI EAFE) were also up, increasing 1.00%.  Bond prices were down for the week, with the 10-year U.S. Treasury ending the week at 1.31%.  (Data source: Wall Street Journal)

Strong Employment Data

Last week the July jobs report was released and came in better than expected as there was a 943,000 increase in payrolls which beat expectations of 900,000. This resulted in the unemployment number dropping from 5.9% to 5.4% in the month of July. After a few months of disappointing jobs data, it was a reaffirmation that the economy is still growing and continuing to add jobs. As we move closer to the fall and kids go back to school and unemployment benefits expire, it is expected we see more job growth in the coming months as we continue to rebound from the Pandemic lows.

Market Worries

As we continue to see more and more of the economy reopen and strong economic numbers to back up the expansion of the economy, we now are faced with the Delta variant concerns. Although equities have had almost no bumps on the way up of recent, some are now worried the Delta variant may stall some of the reopening of the economy. Although there are some worries for the market, if we look back on past recoveries we saw the same red flags. In 1994 it was the fear of rate hikes that worried the market but the market went on to gain another 248% until that bull market ended in March of 2000. In 2010 there was worries of a double-dip recession but once again after the market dipped the S&P rose 231% until February of 2020. Every market has worries but as we currently see the economy continuing to grow and corporate earnings continue to grow the market has a solid foundation.

Quiz:

Quiz

What was the unemployment rate in the United States pre-pandemic?   (Scroll Down for Answer)

  1.    2.2%
  2.    2.8%
  3.    3.5%
  4.    4.6%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Answer below.

 

 

Have a Great Week!

 

 

 

 

 

 

 

 

 

Answer:

   3.   3.5%.  In February, 2020 the unemployment rate sat at 3.5% with 5.7 million people unemployed, currently there are 8.7 million people unemployed.