Markets “In a Nutshell” for October 26, 2021
Investment Week at a Glance
Stocks finished higher for the week. The Dow Jones Industrial Average rose 1.10%, the S&P 500 was up 1.60%, and the NASDAQ rose 1.30%. Foreign stocks (MSCI EAFE) were also up, rising 0.20%. Bond prices were down for the week, with the 10-year U.S. Treasury ending the week at 1.64%. (Data source: Wall Street Journal)
Equities Reach All Time Highs
Equities continued to rally last week as both the S&P 500 and Dow Jones closed at record highs throughout the week. This was the first record high for the S&P 500 since September 2nd and the first record high for the Dow Jones since August 16th. Equities as a whole are up almost 6% in October and have regained their losses after a weak September. Although equities are moving higher the bond market has struggled as inflation worries continue to persist and the 10-year Treasury yield has moved higher to levels we last saw in May. Although yields have moved higher recently, we are still at historically low levels which are favorable to equities for the time being.
The market will have a busy week ahead of itself as 30% of the S&P 500 will report their quarterly results this week along with 1/3 of the Dow Jones. Strong earnings have been a catalyst for the market recently and are a major factor in why equities have once again pushed to all-time highs. The market is expecting strong earnings to continue and has high expectations for quarterly results. So far 84% of companies have beat estimates for the 3rd quarter and in comparison to last year, earnings are expected to be up almost 35%. If companies fail to meet these high expectations expect some market volatility as the market prices in these results.
How many times has the S&P 500 closed at a new all-time high this year? (Scroll Down for Answer)
Have a Great Week!
2) 55 times, with another record close last week this marks the 55th time this year we have seen a record close. The most record closes on the S&P 500 in a calendar year is 77 which happened in 1995.