Telemus Weekly Market Review January 13th - January 17th, 2020
January 13 – January 17 Week in review
The stock market once again reached new records last week, as corporate earnings, economic data, trade news, and the continuing bullish price action bolstered risk sentiment. The S&P 500 gained 2%, the Nasdaq Composite rose 2.3%, and the Dow Jones Industrial Average was up 1.8%. Even small cap stocks did well last week with the Russell 2000 rising 2.5%.
Six of the 11 S&P 500 sectors finished with gains of at least 2.0%, including a 3.8% gain in the defensive-oriented utilities sector. The energy sector was the only sector to finish lower last week, as oil prices continued to falter.
The news flow remained mostly positive which indicated that the economy is still growing at a steady pace, which could continue to favor equities. On the economic data front, retail sales and housing starts showed healthy gains in December, while inflation pressures remained muted. In trade news, the U.S. removed China from its currency manipulator list, the Phase One trade deal was signed, and the USMCA trade deal was passed in the Senate.
Earnings reports were generally positive, too. Financial companies, most notably Morgan Stanley, kicked off the fourth quarter reporting season with solid results, although investors will have to wait until next week for guidance from a wider range of companies.
Alphabet became the fourth U.S. company to reach the $1 trillion market-cap valuation last week. General concerns about valuations were subdued considering all the pieces of good news, which also helped the market look past relatively disappointing holiday sales results from Target and earnings results from several transportation companies.
U.S. Treasuries were little changed in another quiet week of trading despite the rally in equities. The 2 year yield was unchanged at 1.56%, and the 10 year yield increased one basis point to 1.84%. On a related note, the Treasury Department said it will start issuing 20-yr bonds in the first half of this year.
In other markets the U.S. Dollar Index increased 0.3% to 97.662 last week and WTI crude fell ending the week at $58.55 a barrel.
January 13 – January 17 Economic Calendar
- Monday
- Tuesday
- Wednesday
- MBA Mortgage Applications
7:00 AM ET - Chicago Fed National Activity Index
8:30 AM ET - Redbook
8:55 AM ET - FHFA House Price Index
9:00 AM ET - Existing Home Sales
10:00 AM ET
- Thursday
- Jobless Claims
8:30 AM ET - Leading Indicators
10:00 AM ET - EIA Natural Gas Report
10:30 AM ET - Kansas City Fed Manufacturing Index
11:00 AM ET - EIA Petroleum Status Report
11:00 AM ET - Fed Balance Sheet
4:30 PM ET
- Friday
- PMI Composite Flash
9:45 AM ET - Baker-Hughes Rig Count
1:00 PM ET
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