Financial Market Update
Welcome to the StrategicPoint Financial Market Update — a market and economic overview of what occurred last week and what’s up for this week. Please find our market commentary and most recent Blog posts in our StrategicPoint of View®.
Last week proved to be a tough one for the market as each of the benchmark indexes listed here lost value. Concern over the possible spread of the coronavirus from China apparently provided the impetus for investors to pull away from stocks. Long-term bond prices soared, pushing yields 15 basis points lower. The price of gold also climbed after falling the week prior. The small caps of the Russell 2000 were hit the hardest, down over 2.0% for the week, which pushed that index below its 2019 closing value. The Global Dow, Dow, and S&P 500 each lost more than 1.0%, while the tech-heavy Nasdaq dropped over three-quarters of a percent.
Oil prices plummeted last week, closing at $54.21 per barrel by late Friday afternoon, down from the prior week’s price of $58.73. The price of gold (COMEX) jumped higher last week, closing at $1,570.70 by late Friday afternoon, up from the prior week’s price of $1,556.80. The national average retail regular gasoline price was $2.537 per gallon on January 20, 2020, $0.033 lower than the prior week’s price but $0.286 more than a year ago.
S&P 500: 3295 (down 1.03% for the week and up 2% for the year)
NASDAQ: 9314 (down 0.79% for the week and up 3.82% for the year)
Dow: 28989 (down 1.22% for the week and up 1.58% for the year)
US Treasury 10yr: 1.68% (from 1.83% last week)
Crude Oil (March): $54.19 (from $58.54 last week)
Gold (January): $1,571.90 (from $1,560.30 last week)
USD/Euro: $1.1025 (from $1.1096 last week)
Last Week’s Headlines
- After falling in November, sales of existing homes advanced in December, climbing 3.6% ahead of November’s totals. Existing home sales finished 2019 at about the same level as in 2018. The median sales price for all housing types in December was $274,500, 7.8% above the December 2018 median sales price ($254,700). Unsold inventory sits at a 3.0-month supply at the current sales pace, down from the 3.7-month figure recorded in November. Sales of existing single-family homes in December were 2.7% greater than sales in November and 10.6% ahead of December 2018. The median sales price for existing single-family homes was $276,900 in December, up 8.0% from the previous December.
- For the week ended January 18, there were 211,000 claims for unemployment insurance, an increase of 6,000 from the previous week’s level, which was revised up by 1,000. According to the Department of Labor, the advance rate for insured unemployment claims remained at 1.2% for the week ended January 11. The advance number of those receiving unemployment insurance benefits during the week ended January 11 was 1,731,000, a decrease of 37,000 from the prior week’s level, which was revised up by 1,000.
The last week of the month offers several important economic reports for December. Sales of new single-family homes have surged during the fourth quarter. November’s sales figures were robust and well ahead of the pace set in November 2018. Indicative of a waning manufacturing sector, new orders for durable goods were 1.3% lower through November 2019 compared to the previous year. December’s totals may provide a boost to that downward trend. The Federal Open Market Committee meets for the first time in 2020. Interest rates are not expected to be adjusted at this time. The first report on the gross domestic product for the fourth quarter is out this week. The third-quarter GDP advanced at an annualized rate of 2.1%.
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*Past performance is not indicative of future results. Indices are unmanaged and you cannot directly invest in them. The Nasdaq Composite Index measures all NASDAQ U.S. and non-U.S. based common stocks listed on the Nasdaq Stock Market. The S&P 500 index is based on the average performance of 500 industrial stocks monitored by Standard and Poor’s. The data referred to above was taken from sources believed to be reliable. StrategicPoint Investment Advisors has not verified such data and no representation or warranty, expressed or implied, is made by StrategicPoint Investment Advisors.
Data sources: 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. Market data: 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). 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 of 500 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. Market indices listed are unmanaged and are not available for direct investment.
The information contained in this post is not intended as investment, tax or legal advice. StrategicPoint Investment Advisors assumes no responsibility for any action or inaction resulting from the contents herein. Third party content does not reflect the view of the firm or of our parent company, Focus Financial Partners. LLC and is not reviewed for completeness or accuracy. It is provided for ease of reference.
Parts of this report were prepared by Broadridge Investor Communication Solutions, Inc. Copyright 2019. Part of this content contributed by Forefield, Inc.