Weekly Market Commentary, May 17th, 2021

ROBARE & JONES ON THE MARKETS

The S&P 500 fell 1.4% this week, despite the index being up over 11% on the year. The drop from last week's record levels came as data showed both the US consumer price index and producer price index rose by more than expected in April.

All but three sectors in the red this week. The consumer discretionary sector had the largest percentage drop of the week, down 3.7%, followed by a 2.2% decline in technology.

On the upside, consumer staples rose 0.4%, followed by a 0.3% increase in financials and a 0.1% lift in materials. Progress has continued with COVID-19, federal health officials saying fully vaccinated people no longer need to wear a mask or physically distance during outdoor or indoor activities. Also, about 46% of American adults are fully vaccinated, according to the CDC.

We are glad to see all of the positive news about the economic progress from the pandemic, but it does seem that investors are now immune to positive COVID news (no pun intended). Hopefully inspectors can have more positive outlooks for the housing and manufacturing indexes to be released this week.

Let's take a look at the benchmarks from this past week!

Vaccinated? No Mask, No Problem

The big news last week was the announcement from the Centers for Disease Control (CDC) that fully vaccinated Americans can resume normal activities without wearing masks or social distancing, except where required by law. Suffice it to say, people are ready to return to normal. Results from the latest Axios-Ipsos Coronavirus survey, conducted in early May, found Americans were feeling more optimistic. Among those surveyed:

59 percent had visited friends or relatives during the previous week.
54 percent had gone out to eat during the previous week.
31 percent had made plans for the summer.
18 percent had a stronger sense of emotional well-being, a six-point jump from the prior survey.

60 percent indicated trips to salons, barber shops, and spas were low- or no-risk activities, up six points from the last survey.

Have your plans changed recently from the CDC news?

Sources:

https://www.economist.com/finance-and-economics/2015/02/19/the-high-cost-of-falling-prices (or go to https://resources.carsongroup.com/hubfs/WMC-Source/2021/05-17-21_TheEconomist-The_High_Cost_of_Falling_Prices-Footnote_1.pdf)

https://www.barrons.com/articles/stock-market-volatility-isnt-the-big-problem-economic-volatility-is-51621039530?refsec=the-trader (or go to https://resources.carsongroup.com/hubfs/WMC-Source/2021/05-17-21_Barrons-Its_Not_Market_Volatility_You_Need_to_Worry_About-Its_Economic-Footnote_2.pdf)

https://www.economist.com/leaders/2021/05/15/the-coming-global-economic-boom-could-have-a-sting-in-the-tail (or go to https://resources.carsongroup.com/hubfs/WMC-Source/2021/05-17-21_TheEconomist-The_Coming_Global_Economic_Boom_Could_Have_a_Sting_in_the_Tail-Footnote_3.pdf)

https://www.freightwaves.com/news/no-relief-global-container-shortage-likely-to-last-until-2022

https://www.federalreserve.gov/newsevents/speech/brainard20210511a.htm

https://www.cdc.gov/coronavirus/2019-ncov/vaccines/fully-vaccinated.html

https://www.ipsos.com/en-us/news-polls/axios-ipsos-coronavirus-index

https://news.northwestern.edu/stories/2021/03/perspective-covid-19-habits/

https://www.bustle.com/articles/147987-20-empowering-quotes-by-female-authors-that-are-perfect-to-decorate-your-office-with