Weekly Market Commentary
ROBARE AND JONES ON THE MARKETS
U.S. stock markets remained calm as a fresh chapter opened in the coronavirus stimulus saga last week.
Congress managed to cobble together a new stimulus package that was acceptable to both sides and pass it. The proposed package included money to help states distribute vaccines, an unemployment benefits extension, $600 checks for eligible Americans, aid for airlines, and other provisions, reported Mike Calia of CNBC.
“…fiscal support is seen as critical to keep the economic recovery from faltering as coronavirus cases rise and cities consider new shutdowns while the number of Americans applying for unemployment benefits declined last week,” reported Colby Smith and Eric Platt of Financial Times.
President Trump disagreed with some provisions in the bill, reported Financial Times. Over the weekend, it was unclear whether he would sign it, veto it, or just hold it without taking action.
Since the $900 billion stimulus bill was attached to the $1.4 trillion government funding bill, the impact of a veto or inaction could be quite significant. “Without Trump’s signature, the government may partially shut down on Tuesday as funding runs out, though Congress could pass a stopgap measure,” reported Daren Fonda of Barron’s.
Let's take a look at the benchmarks from this past week!
Expected Risks for 2021
After a year of living with the fear of COVID-19, many investors are hoping 2021 will bring a return to ‘normal,’ even if the new normal may not be exactly like the old one.
This doesn’t mean 2021 will be risk free. In its December market sentiment survey, Deutsche Bank asked more than 900 market professionals about the biggest risks to global financial markets in 2021. Here are the concerns they highlighted:
- 38 percent Virus mutates and vaccines are less effective
- 36 percent Vaccine side effects emerge
- 34 percent People refuse to take the vaccine
- 34 percent Technology bubble bursts
- 26 percent Central banks end stimulus too soon
- 22 percent Inflation returns earlier than expected
It’s possible none of these will occur and investors will sail smoothly into and through the new year. We hope that’s the case and next year brings with it a return to normal.
What do you expect for 2021?
https://www.ft.com/content/b0f95a35-5aa6-4a9a-a0f6-ea509e27aca0 (or go to https://peakcontent.s3-us-west-2.amazonaws.com/+Peak+Commentary/12-28-20_FinancialTimes-Treasuries_Under_Pressure_as_Traders_Look_Past_Trump_Stimulus_Pushback-Footnote_2.pdf)
https://www.barrons.com/articles/stimulus-bills-fate-remains-in-limbo-the-stock-market-isnt-reacting-so-far-51609005727 (or go to https://peakcontent.s3-us-west-2.amazonaws.com/+Peak+Commentary/12-28-20_Barrons-Stimulus_Bills_Fate_Remains_in_Limbo-The_Stock_Market_Isnt_Reacting_So_Far-Footnote_3.pdf)
https://www.barrons.com/market-data?mod=BOL_TOPNAV (or go to https://peakcontent.s3-us-west-2.amazonaws.com/+Peak+Commentary/12-28-20_Barrons-Market_Data-Footnote_6.pdf)
https://www.barrons.com/market-data/market-lab (or go to https://peakcontent.s3-us-west-2.amazonaws.com/+Peak+Commentary/12-28-20_Barrons-Sentiment_Data-Footnote_7.pdf)
https://www.ft.com/content/1afc5e9f-f05d-48f5-a126-870ba70ce254 (or go to https://peakcontent.s3-us-west-2.amazonaws.com/+Peak+Commentary/12-28-20_FinancialTimes-What_Can_Go_Wrong-Investors_Views_on_the_Big_Risks_to_Markets_in_2021-Footnote_8.pdf)