Our Market Update for the 1st Half of December 2020

For our article today, we have a market update with the newest issue of our biweekly Market Movers Newsletter! This entire year has been a very active and tumultuous time for the markets – with many up and downs. The global pandemic, state of the economy, world affairs, political climate, and more have all had influence over the markets this year. As always, here at FFR we strongly encourage our clients, as well as any investor, to stay current with what could be influencing the markets. If  you are looking for a new strategy for your portfolio to recover some losses or stay on top, feel free to visit our forex, options, index futures, or commodities pages to learn more. If you would prefer, you can also always speak with a member of our client care team by giving us a call at (800) 883-0524 or contacting us via email or our contact form. If you would simply like to sign up for notifications for our biweekly Market Movers Newsletter, send us an email at [email protected] or come back to visit our blog every two weeks! Now, let’s discuss what moved the markets with our market update for the 1st half of December!

December 1, 2020

  • New month but same news in that US indexes hit record highs on hopes that the US will see a sharp economic recovery by next year
  • The November PMI manufacturing index numbers came in right at the expected figure of 56.7
  • November’s ISM manufacturing index also came in the expected range at 57.5 though slightly under the anticipated figure of 57.7
  • October’s construction spending report rose to 1.3%, a year over year increase of 3.7%; exhibiting strength in residential rather than commercial construction
  • Jerome Powell stated that the economy is “extraordinarily uncertain,” reiterating the importance of reaching a federal stimulus deal in order to prevent further economic declines as a result of the pandemic

December 2, 2020

  • The market took a breather after yesterday’s session, hovering near its record highs
  • News of vaccine development and talk toward a fiscal stimulus deal all worked together to buoy the broader market
  • November’s ADP employment report saw a total of 307,000 non-farm payroll jobs, lower than the 420,000 that was expected. This figure also missed the larger consensus range

December 3, 2020

  • A flat though “solid” performance as markets edged up near record highs on hopes of a recovery in 2021
  • New jobless claims came in at a relatively “bleak” figure of 712,000, though not as bad as the 780,000 expected
  • Trading seemed relatively still and flat as investors are looking forward to tomorrow’s employment situation report
  • So far, market optimism is translating into higher stock prices, yet vulnerable to any shocks that might cause near-term weakness

December 4, 2020

  • The broader market rallied to record levels on Friday, on pace for another weekly advance, as traders shook off a disappointing U.S. jobs report
  • There was no one specific catalyst that propelled stocks higher. Rather, it was the positive cumulative effect that the week’s developments had on an already bullish investor mindset that could best explain the gains. In simpler terms, the market rode a bullish momentum
  • Also, stimulus talks were renewed. Democratic Congressional leadership and some Republicans supported a proposed $908 billion bipartisan stimulus bill as a starting point for negotiations
  • Moderna (MRNA) said its vaccine was 94.1% effective in preventing COVID-19 and 100% effective in protecting against serious outcomes
  • Pfizer (PFE) and BioNTech (BNTX) received emergency approval for their COVID-19 vaccine in the UK

December 7, 2020

  • Markets took a breather from last week’s rally, sliding slightly on very few minor economic reports
  • Consumer credit is down to $7.2 billion, significantly lower than the $17.0 billion that economists had expected
  • As unemployed Americans are nearing the end-of-month fiscal benefits cliff, and as lockdowns continue, more Americans are saving in anticipation of potentially worse circumstances ahead

December 8, 2020

  • The market’s resolute rally reasserted itself, overcoming early losses to see to it that the year-end upward bias prevails
  • Non-farm productivity came in at 4.6%, slightly lower than the 4.9% consensus
  • Unit labor costs declined to -6.6%, not quite the -8.9% analysts had expected

December 9, 2020

  • Sellers finally showed up as overall sentiment in the market reflected the possibility that at these levels, stocks are a bit overheated
  • Mortgage applications are down; given the uncertainty, particularly in employment, pervading the economic landscape, this shouldn’t come as a surprise
  • The October JOLTS report came in at 6.652 million, beating consensus of 6.4 million; the Labor Department’s JOLTS report tracks monthly change in job openings and offers rates on hiring and quits

December 10, 2020

  • Today marked another tepid performance for the broader market
  • Jobless claims came in as a negative surprise, with 853,000 new claims, higher than the anticipated figure of 724,000; currently, 19 million Americans are receiving unemployment benefits; a second lockdown increases the likelihood that larger unemployment figures are to come
  • Consumer price index came in soft at 0.2% month over month; year over year, it increased by 1.2% – both lower than consensus expectations

December 11, 2020

  • The Dow fell early on but recovered as Congress’ stimulus talks remain uncertain yet hopeful enough for investors to find some confidence in the markets
  • Consumer sentiment remains on the optimistic side, giving us a number of 81.4, far above the consensus expectations of 76.0. Vaccine progress might be a driving factor behind consumer optimism

December 14, 2020

  • A sluggish start to the week as vaccine rollouts and stimulus talks weren’t enough to support the markets
  • As the US death toll due to COVID reached over 300,000 and New York possibly undergoing a second shutdown, market sentiment was dampened with regard to near-term prospects
  • Besides these factors, there were no major economic reports released today

December 15, 2020

  • Stocks traded higher as Congress continued negotiations on another economic relief package and Covid-19 vaccines began to roll out across the country
  • Industrial production saw a slight increase at 0.4%, higher than the 0.3% expected; manufacturing came in at 0.8% double the anticipated 0.4%, and capacity utilization stands at 73.3% in line with consensus
  • In contrast, the Empire State Manufacturing Index came in at 4.9%, just slightly lower than the expected 5.8%

That concludes what moved the markets in the busy month of December! For more frequent FFR and market news, be sure to follow us on Instagram, Facebook, Twitter, and LinkedIn. Happy trading, everyone!

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