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Weekly Market Insights header image

Weekly Market Insights

The Markets (as of market close​ ​​June ​​26, 2020)

The week began with the stock market picking up where it left off the previous week. Each of the benchmark indexes listed here advanced in value, led by the tech-heavy Nasdaq, which jumped 1.10%, pushed higher by Amazon and Adobe. Last Monday's run marked the seventh straight advance for the Nasdaq — its longest rally of the year. The Russell 2000 gained 1.00%, followed by the S&P 500, the Dow, and the Global Dow. Crude oil reached $40 per barrel for the first time in quite a while, the dollar dropped, and the yield on 10-year Treasuries inched higher. Stock values climbed despite the accelerating number of COVID-19 cases reported.

Tuesday saw both the Nasdaq and Russell 2000 continue to surge. In fact, the Nasdaq hit an all-time high as investors seemed to focus on signs of economic growth and the expectation of more government stimulus. President Trump tweeted that the U.S.-China trade deal remains fully intact, which further encouraged investors despite U.S. health advisor Anthony Fauci's warning of a disturbing surge in COVID-19 cases. Apple, Amazon, and Microsoft were winners at the end of the day, as were road and rail stocks, real estate, utilities, airlines, and retailers.

Stocks took a nosedive midweek as the growing number of reported COVID-19 cases was too much for investors to ignore. The pandemic is prompting fears that renewed restrictions will slow economic growth. Money poured into bonds, pushing prices higher and driving yields lower. Among sectors taking a particularly hard hit last Wednesday were energy, financials, and industrials. Airline stocks, which had been climbing as restrictions eased, got pummeled. Each of the indexes listed here took a sizeable hit, led by the small caps of the Russell 2000, which gave back nearly 3.50%. The Dow closed down 2.72% on the day, followed by the Global Dow, the S&P 500, and the Nasdaq, which ended its run of daily gains by sinking 2.19%.

Thursday was a better day for equities as each of the benchmark indexes listed here posted gains, led by the Russell 2000, which climbed nearly 2.00%. Bank stocks enjoyed a good boost after the Federal Deposit Insurance Corporation eased limits on bank risk-taking. As stocks climbed, more bad news came from the COVID-19 front. Thursday, the number of new virus cases surpassed April's peak, prompting the governor of Texas to pause the process of reopening. Also, new weekly claims for unemployment insurance approached 1.5 million — a figure that's lower than the prior week, but still indicative of the number of people who have lost their jobs.

Both Texas and Florida imposed new restrictions as reported virus cases surged last Friday, sending stocks tumbling. These are the first states to reimpose restrictions, although several other states are considering added restrictions and/or delaying reopenings. The Dow fell 2.84%, the Nasdaq dropped 2.59%, and both the S&P 500 and Russell 2000 gave back more than 2.40%, respectively.

For the week, each of the benchmarks lost notable value, led by the Dow, which fell more than 3.30%. Clearly, rising COVID-19 cases throughout several parts of the country have curbed investor enthusiasm over encouraging economic news. The market swung up and down for much of the week, with bank stocks being particularly volatile. After the FDIC eased restrictions on bank investing last Thursday, the Federal Reserve indicated its plan to restrict banks' sharing of profits through dividends and share repurchases. Of the remaining indexes listed here, the S&P 500 fell back into correction territory after dropping 2.86%. The small caps of the Russell 2000 lost nearly 3.00%, the Global Dow declined nearly 2.25%, while the Nasdaq fared the best, losing less than 2.00% for the week.

After climbing higher the week before, crude oil prices sank lower last week, closing at $38.10 per barrel by late Friday afternoon, down from the prior week's price of $39.50. The price of gold (COMEX) advanced again last week, closing at $1,784.10 by late Friday afternoon, up from the prior week's price of $1,755.10. The national average retail regular gasoline price was $2.129 per gallon on June 22, 2020, $0.031 higher than the prior week's price but $0.525 less than a year ago.

Market/Index

2019 Close

Prior Week

As of 6/26

Weekly Change

YTD Change

DJIA

28,538.44

25,871.46 25,015.55

-3.31%

-12.34%

Nasdaq

8,972.60

9,946.12

9,757.22 -1.90% 8.74%

S&P 500

3,230.78

3,097.74

3,009.05

-2.86% -6.86%

Russell 2000

1,668.47

1,418.64

1,378.78
-2.81% -17.36%

Global Dow

3,251.24 2,838.87 2,775.41
-2.24%
-14.64%

Fed. Funds target rate

1.50%​–1.75%

0.​00%​–0.25%

0.​00%​–0.25%

 0 bps

-150 bps

10-year Treasuries

1.91%

0.69%

0.63%

-6 bps

-​​​​​1​26 bps

Chart reflects price changes, not total return. Because it does not include dividends or splits, it should not be used to benchmark performance of specific investments.

Last Week's Economic Headlines

  • The third and final estimate of the gross domestic product for the first quarter of 2020 showed the economy slowed at an annual rate of 5.0%. In the fourth quarter, the GDP increased 2.1%. A main contributor to the deceleration of the economy in the first quarter was consumer spending, which fell 6.8%, exhibiting the initial impact of the pandemic. Business investment fell 1.3%, although residential investment soared 18.2%. The personal consumption expenditures price index increased 1.3%. Excluding food and energy prices, the PCE price index increased 1.7%.
  • According to the latest report from the Bureau of Economic Analysis, consumer spending ramped up 8.2% in May following downturns in March and April, when personal consumption expenditures fell 6.6% and 12.6%, respectively. Consumer prices inched ahead 0.1% last month and are up 0.5% since May 2019. Personal income sank 4.2% last month and disposable, or after-tax, income dropped 4.9%, each figure impacted by a decrease in payments from federal economic recovery programs.
  • The international trade in goods deficit was $74.3 billion in May, up $3.6 billion from $70.7 billion in April. Exports of goods for May were $90.1 billion, $5.5 billion less than April exports. Imports of goods for May were $164.4 billion, $1.9 billion less than April imports.
  • Existing home sales fell 9.7% in May, declining for the third consecutive month. Overall, existing home sales are down 26.6% from a year ago. The median existing-home price for all housing types in May was $284,600, down from April's $286,800 but 2.3% ahead of the May 2019 median sales price ($278,200). Total housing inventory at the end of May totaled 1.55 million units, up 6.2% from April but down 18.8% from one year ago (1.91 million). Unsold inventory has increased, sitting at a 4.8-month supply at the current sales pace, up from 4.0 months in April.
  • While existing home sales may have fallen in May, sales of new homes soared. According to the Census Bureau, sales of new single-family homes in May were 16.6% above the April total and 12.7% ahead of May 2019. The median sales price of new houses sold in May 2020 was $317,900 ($303,000 in April). The average sales price was $368,800 ($352,300 in April). The estimate of new houses for sale at the end of May was 318,000, which represents a supply of 5.6 months at the current sales rate.
  • New orders for manufactured durable goods rebounded in May, advancing 15.8% over April's totals. Transportation equipment, primarily vehicles and aircraft, led the increase, climbing a whopping 80.7%. Excluding transportation, new orders increased 4.0% with orders for core capital goods (nondefense capital goods excluding aircraft) up 2.3%. Shipments of durable goods increased 4.4% in May following April's 18.6% decline. New orders for nondefense capital goods in May increased 27.1%. Shipments increased 0.4%.
  • For the week ended June 20, there were 1,480,000 claims for unemployment insurance, a decrease of 60,000 from the previous week's level, which was revised up by 32,000. According to the Department of Labor, the advance rate for insured unemployment claims decreased 0.5 percentage point to 13.4% for the week ended June 13. The advance number of those receiving unemployment insurance benefits during the week ended June 13 was 19,522,000, a decrease of 767,000 from the prior week's level, which was revised down by 255,000.

Eye on the Week Ahead

The employment numbers for June are out this week. May's report was unexpectedly favorable with 2.5 million new jobs added. However, weekly unemployment claims continue to remain in the millions, which could be an indication that June's employment figures may not be as favorable as they were the previous month.

Data sources: Economic: Based on data from U.S. Bureau of Labor Statistics (unemployment, inflation); U.S. Department of Commerce (GDP, corporate profits, retail sales, housing); S&P/Case-Shiller 20-City Composite Index (home prices); Institute for Supply Management (manufacturing/services). Performance: Based on data reported in WSJ Market Data Center (indexes); U.S. Treasury (Treasury yields); U.S. Energy Information Administration/Bloomberg.com Market Data (oil spot price, WTI Cushing, OK); www.goldprice.org (spot gold/silver); Oanda/FX Street (currency exchange rates). News items are based on reports from multiple commonly available international news sources (i.e. wire services) and are independently verified when necessary with secondary sources such as government agencies, corporate press releases, or trade organizations. All information is based on sources deemed reliable, but no warranty or guarantee is made as to its accuracy or completeness. Neither the information nor any opinion expressed herein constitutes a solicitation for the purchase or sale of any securities, and should not be relied on as financial advice. Past performance is no guarantee of future results. All investing involves risk, including the potential loss of principal, and there can be no guarantee that any investing strategy will be successful.

The Dow Jones Industrial Average (DJIA) is a price-weighted index composed of 30 widely traded blue-chip U.S. common stocks. The S&P 500 is a market-cap weighted index composed of the common stocks of500 leading companies in leading industries of the U.S. economy. The NASDAQ Composite Index is a market-value weighted index of all common stocks listed on the NASDAQ stock exchange. The Russell 2000 is a market-cap weighted index composed of 2,000 U.S. small-cap common stocks. The Global Dow is an equally weighted index of 150 widely traded blue-chip common stocks worldwide. The U.S. Dollar Index is a geometrically weighted index of the value of the U.S. dollar relative to six foreign currencies. Market indices listed are unmanaged and are not available for direct investment.

Prepared by Broadridge Investor Communication Solutions, Inc. Copyright 2020.
These materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable — we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice. Market summaries contain information on the Dow, S&P 500, NASDAQ, Russell 2000, Global Dow, Federal Funds interest rate, and 10-year Treasury yields, as well as highlights of past and future economic data.

The Markets (as of market close​ ​​June ​1​9, 2020)

Equities began the week edging higher following the Federal Reserve's announcement that it would buy corporate bonds under an emergency lending program. The Russell 2000 closed up 2.3%, the Nasdaq gained 1.4%, while the S&P 500 and the Dow eked out gains of less than 1.0%, respectively. After last week's tailspin, crude oil prices rebounded while the yield on 10-year Treasuries advanced slightly. Investors remain weary, however, as more than 20 states are seeing an uptick in reported cases of COVID-19, and new hotspots in Beijing and India are raising concerns of a resurgence of the pandemic.

Following an impressive retail sales report, stocks jumped higher last Tuesday. Led by the Global Dow (2.45%), each of the benchmark indexes listed here posted gains of at least 1.75% (Nasdaq). Also climbing were crude oil prices (2.24%), gold (0.47%), and the yield on 10-year Treasuries (7.69%). Most sectors advanced, with the best performers being energy, health care, and materials. Along with the robust retail sales report, the Trump administration announced that it is preparing a $1 trillion infrastructure proposal aimed at accelerating the economy.

The Nasdaq inched ahead on Wednesday, but that was the only benchmark to gain. The large caps of the Dow and S&P 500 fell 0.65% and 0.36%, respectively. The Russell 2000 sank 1.77%, and the Global Dow changed negligibly. The yield on 10-year Treasuries dropped 3.04% while crude oil prices decreased 1.75% to $37.71 per barrel. It appears increases in reported COVID-19 cases were enough to pull investors from stocks.

Stocks were mixed last Thursday as concerns over the escalating number of reported virus cases, coupled with another 1.5 million new claims for unemployment insurance, caused investor uneasiness. The Dow fell 0.15% while the S&P 500, the Nasdaq, and the Russell 2000 all posted marginal gains. Energy stocks helped buoy stocks following a pledge from major oil-producing countries to continue to limit output.

Friday closed what may be best described as a roller-coaster ride for stocks. The Dow fell 0.80%, the S&P 500 dropped 0.56%, the Russell 2000 lost 0.59%, and the Global Dow gave back 0.29%. Only the tech-heavy Nasdaq eked out a 0.03% gain. Earlier in the day, stocks rallied following reports out of China that it would comply with phase one of the trade deal by accelerating purchases of U.S.-exported farm goods. Nevertheless, record increases of COVID-19 reported cases in Florida and Arizona drew stocks back from earlier gains.

For the week, the ups and downs experienced by equities ended with the benchmark indexes closing ahead, led by the Nasdaq, followed by the Russell 2000, the S&P 500, the Global Dow, and the Dow. The yield on 10-year Treasuries closed the week where it began. Year to date, the Nasdaq is safely ahead of last year's closing value, while the other benchmark indexes have yet to catch up to their respective 2019 year-end marks.

Crude oil prices are back on the upswing after major oil-producing countries agreed to continue to limit output. The week ended with oil prices hovering around $39.50 per barrel by late Friday afternoon, up from the prior week's price of $36.41. The price of gold (COMEX) continued to climb last week, closing at $1,755.10 by late Friday afternoon, up from the prior week's price of $1,738.40. The national average retail regular gasoline price was $2.098 per gallon on June 15, 2020, $0.062 higher than the prior week's price but $0.572 less than a year ago.

Market/Index

2019 Close

Prior Week

As of 6/19

Weekly Change

YTD Change

DJIA

28,538.44

25,605.54 25,871.46

1.04%

-9.53%

Nasdaq

8,972.60

9,588.81

9,946.12 3.73% 10.85%

S&P 500

3,230.78

3,041.31

3,097.74

1.86% -4.12%

Russell 2000

1,668.47

1,387.68

1,418.64
2.23% -14.97%

Global Dow

3,251.24 2,799.51 2,838.87
1.40%
-12.68%

Fed. Funds target rate

1.50%​–1.75%

0.​00%​–0.25%

0.​00%​–0.25%

 0 bps

-150 bps

10-year Treasuries

1.91%

0.69%

0.69%

0 bps

-​​​​​1​22 bps

Chart reflects price changes, not total return. Because it does not include dividends or splits, it should not be used to benchmark performance of specific investments.

Last Week's Economic Headlines

  • Retail sales spiked in May, advancing 17.7% from the previous month. Sales are down 6.1% from May 2019. Retail trade sales also increased, climbing 16.8% last month. Nonstore (online) retail sales increased 9.0% in May and are up 30.8% since May 2019. Last month, a tremendous spike in sales was seen by some retailers including clothing and clothing accessories stores (188.0%), motor vehicle and parts dealers (44.1%), furniture and home furnishing stores (89.7%), electronics and appliance stores (50.5%), and sporting goods, hobby, musical instrument, and book stores (88.2%).
  • New home construction should be on the rise in June as May saw building permits jump by 14.4%. Housing starts climbed 4.3% last month but housing completions fell by 7.3%, likely due to a scale-back of construction work due to the pandemic.
  • Total industrial production increased 1.4% in May as many factories resumed at least partial operations following suspensions related to the COVID-19 pandemic. Nevertheless, total industrial production remains 15.4% below its February pre-virus level and 15.3% below its May 2019 rate. Manufacturing rebounded from consecutive monthly decreases by advancing 3.8% in May, with most major industries posting increases, the largest of which coming from motor vehicles and parts. Mining and utilities fell 6.8% and 2.3%, respectively.
  • For the week ended June 13, there were 1,508,000 claims for unemployment insurance, a decrease of 58,000 from the previous week's level, which was revised up by 24,000. According to the Department of Labor, the advance rate for insured unemployment claims was 14.1% for the week ended June 6. The advance number of those receiving unemployment insurance benefits during the week ended June 6 was 20,544,000, a decrease of 62,000 from the prior week's level, which was revised down by 323,000.

Eye on the Week Ahead

Several important economic reports are out this week. The final estimate for the first-quarter gross domestic product is released this week. It is not expected that much will change from the prior estimate, which had the economy slow at a rate of 5.0%. May home sales figures are also available this week. Existing home sales plunged in April, while new home sales were little changed. The durable goods orders report for May is also out this week. Orders fell more than 17.0% in April. May should show some improvement.

Data sources: Economic: Based on data from U.S. Bureau of Labor Statistics (unemployment, inflation); U.S. Department of Commerce (GDP, corporate profits, retail sales, housing); S&P/Case-Shiller 20-City Composite Index (home prices); Institute for Supply Management (manufacturing/services). Performance: Based on data reported in WSJ Market Data Center (indexes); U.S. Treasury (Treasury yields); U.S. Energy Information Administration/Bloomberg.com Market Data (oil spot price, WTI Cushing, OK); www.goldprice.org (spot gold/silver); Oanda/FX Street (currency exchange rates). News items are based on reports from multiple commonly available international news sources (i.e. wire services) and are independently verified when necessary with secondary sources such as government agencies, corporate press releases, or trade organizations. All information is based on sources deemed reliable, but no warranty or guarantee is made as to its accuracy or completeness. Neither the information nor any opinion expressed herein constitutes a solicitation for the purchase or sale of any securities, and should not be relied on as financial advice. Past performance is no guarantee of future results. All investing involves risk, including the potential loss of principal, and there can be no guarantee that any investing strategy will be successful.
The Dow Jones Industrial Average (DJIA) is a price-weighted index composed of 30 widely traded blue-chip U.S. common stocks. The S&P 500 is a market-cap weighted index composed of the common stocks of500 leading companies in leading industries of the U.S. economy. The NASDAQ Composite Index is a market-value weighted index of all common stocks listed on the NASDAQ stock exchange. The Russell 2000 is a market-cap weighted index composed of 2,000 U.S. small-cap common stocks. The Global Dow is an equally weighted index of 150 widely traded blue-chip common stocks worldwide. The U.S. Dollar Index is a geometrically weighted index of the value of the U.S. dollar relative to six foreign currencies. Market indices listed are unmanaged and are not available for direct investment. 

Prepared by Broadridge Investor Communication Solutions, Inc. Copyright 2020.
These materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable — we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice. Market summaries contain information on the Dow, S&P 500, NASDAQ, Russell 2000, Global Dow, Federal Funds interest rate, and 10-year Treasury yields, as well as highlights of past and future economic data.

29348.10

1,355.53
1,355.53

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