Weekly Market Recap

Week ended October 15

Capital market performance report

Detailed weekly data on equities and fixed income—factors, fundamentals, styles/sizes, sectors/industries/stocks

Market-moving news

On the rebound

The major U.S. stock indexes slipped on Monday and Tuesday but came back in a big way late in the week, rising around 2% overall to record their second positive week in a row. A strong start to quarterly earnings season provided a key catalyst.

Earnings surprises

As of Friday, 80% of the S&P 500 companies that had reported third-quarter results exceeded analysts’ earnings estimates, according to FactSet. That so-called beat rate ranks above the 76% five-year average. Results were in from 8% of S&P 500 companies as of Friday, with many of the early reports coming in from major banks.

Retail resilience

Despite inflation concerns and the Delta variant’s spread, U.S. shoppers continued to spend at a steady clip in September. The government reported on Friday that sales at retail stores, restaurants, and online sellers rose a seasonally adjusted 0.7% compared with the previous month. Relative to September 2020, sales jumped 13.9%.

Inflation spike persists

Amid rising energy costs and disruptions in global supply chains, the recent spike in U.S. consumer prices extended into September, picking up slightly from August’s level. The Consumer Price Index rose 5.4% compared with the same month a year earlier. The latest increase is roughly in line with the elevated levels seen in June and July.

Labor market bright spot

Although recent monthly jobs reports have been disappointing, the number of Americans making initial claims for unemployment benefits has declined to the lowest level since March 2020. New claims dropped below 300,000 in the latest weekly count, marking the second consecutive weekly decline.

Thursday surge

Strong earnings reports and a decline in weekly unemployment claims helped to fuel a stock market rally on Thursday. The S&P 500’s 1.7% surge was that index’s biggest daily gain in more than seven months; the NASDAQ also added 1.7% and the Dow was up 1.5%.

Slimmer growth outlook

The International Monetary Fund trimmed its global economic growth forecast for 2021. Its current 5.9% global GDP growth estimate is down one-tenth of a percentage point from an earlier forecast; the fund kept its 2022 growth forecast unchanged at 4.9%. This year’s revised outlook comes as the global trade is challenged by supply chain issues and many countries confront increasing COVID-19 cases.

Bitcoin rally

The price of Bitcoin rose above $60,000 on Friday, close to the record high that the cryptocurrency set six months earlier. As of Friday, Bitcoin’s price had jumped about 40% since the end of September, when it was around $44,000 as of Friday.

The week ahead: October 18-22

Monday

Industrial production and capacity utilization, U.S. Federal Reserve
Housing Market Index, National Association of Home Builders

Tuesday

Housing starts, U.S. Census Bureau

Wednesday

No major reports scheduled

Thursday

The Conference Board Leading Economic Index for the U.S
Weekly unemployment claims, U.S. Department of Labor
Existing home sales, National Association of Realtors

Friday

No major reports scheduled

Unless otherwise noted, all data is from FactSet.

The data provided is for informational purposes only and is not an endorsement of any security, mutual fund, sector, or index. This does not illustrate the performance of any John Hancock fund. The information contained here is not guaranteed as to accuracy or completeness. All economic and performance information is historical and does not guarantee future results.

The Dow Jones Industrial Average is a price-weighted index comprising 30 widely traded blue chip U.S. common stocks. The NASDAQ Composite Index is a market-value-weighted index of all common stocks listed on the NASDAQ stock exchange. The S&P 500 Index tracks the performance of 500 of the largest publicly traded companies in the United States. The MSCI Europe, Australasia, and Far East (EAFE) Index tracks the performance of publicly traded large- and mid-cap stocks of companies in those regions. The Cboe Volatility Index (VIX) shows the market’s expectation of 30-day volatility and is constructed using the implied volatilities of a wide range of S&P 500 Index options. Weekly and year-to-date figures for the VIX show percentage changes, not investment returns. The Russell 2000 Index tracks the performance of approximately 2,000 publicly traded small-cap companies in the United States. It is not possible to invest directly in an index.

The Treasury yield curve is derived from available U.S. Treasury securities trading in the market and is provided directly by the U.S. Federal Reserve. The spread measures the difference in yield between two government securities. A normal (positive) yield curve occurs when longer-term rates are higher than shorter-term rates. The opposite holds true for an inverted yield curve. Year-to-date changes in U.S. Treasury bond yields are shown in basis points (bps). One hundred basis points equals one percent.

Oil prices are represented by West Texas Intermediate (WTI) crude oil.

The G20 countries comprise a mix of the world’s largest advanced and emerging economies, representing about two-thirds of the world’s population, 85% of global gross domestic product, and over 75% of global trade.

Investment returns

Equities

U.S. equity size and style total returns as of 10/15/21 (%)

1 week YTD

1 week
1.4	2.0	2.6	Large
1.7	2.3	3.4	Mid
1.0	1.5	1.9	Small
Value	Core	Growth

YTD
20.7	19.8	18.9	Large
23.5	20.1	14.0	Mid
27.2	15.6	5.1	Small
Value	Core	Growth

Index/market total returns as of 10/15/21 (%)

Close Week YTD

	Close	Week	YTD
Dow Jones Industrial Average	35,294.8	1.6	17.0
NASDAQ Composite Index	14,897.3	2.2	16.2
S&P 500 Index	4,471.4	1.8	20.4
MSCI EAFE Index	2,324.5	2.4	10.9
Cboe Volatility Index	16.3	-13.3	-28.5

International/developed (%)

1 week YTD

	1 week	YTD
EAFE	2.4	10.9
Europe	2.9	14.5
France	2.8	16.0
Germany	2.8	7.1
Italy	2.1	13.9
Japan	1.6	3.7
Spain	0.3	6.1
Switzerland	2.1	10.6
U.K.	2.9	17.1

Emerging markets (%)

1 week YTD

	1 week	YTD
EM	2.1	1.5
Brazil	2.9	-8.5
China	2.1	-13.3
India	1.8	30.2
Indonesia	5.0	7.3
Korea	2.2	-9.4
Mexico	4.6	19.0
Russia	1.8	41.1
Taiwan	1.6	16.3

S&P 500 sectors (%)

1 week YTD

	1 week	YTD
S&P 500 Index	1.8	20.4
Communication services	-0.4	23.3
Consumer discretionary	3.6	15.9
Consumer staples	1.2	7.7
Energy	1.2	57.2
Financials	1.2	35.9
Healthcare	0.8	14.1
Industrials	1.9	17.3
Information tech	2.6	20.3
Materials	3.7	17.5
Real estate	3.5	29.2
Utilities	1.4	7.2

Fixed income, currencies, and commodities

U.S. fixed-income style total returns as of 10/15/21 (%)

1 week YTD

1 week
0.0	-0.2	2.0	High
-0.1	0.0	1.8	Med	QUALITY
0.0	0.2	0.4	Low
Ltd	Int	Long
INTEREST-RATE SENSITIVITY

YTD
0.0	-1.5	-7.0	High
-0.2	-1.1	-0.6	Med	QUALITY
5.3	4.5	7.0	Low
Ltd	Int	Long
INTEREST-RATE SENSITIVITY

U.S. Treasury bond yields as of 10/15/21 (%)

END OF WEEK PRIOR YEAR END YTD CHANGE (BPS)

	END OF WEEK	PRIOR YEAR END	YTD CHANGE (BPS)
2 Yr	0.40	0.12	28
10 Yr	1.57	0.92	65
30 Yr	2.05	1.65	40
2-10 spread	1.18	0.80	38
10-30 spread	0.48	0.73	-25

U.S. bond sector total returns (%)

1 week YTD

	1 week	YTD
Aggregate	0.3	-1.7
Bank loans	0.0	2.3
Convertible	1.7	7.6
Corporate	0.3	-2.0
High yield	0.2	4.5
MBS	0.1	-0.9
Municipal	0.1	0.7
Preferreds	1.1	0.8
TIPS	0.7	4.5
Treasury	0.3	-2.7

Global bond total returns (%)

1 week YTD

	1 week	YTD
EM Local	0.8	-5.8
EMD USD	0.5	-1.5
Global Agg	0.2	-4.2
Global Agg Ex-U.S.	0.2	-5.5
Multiverse	0.2	-4.0

Commodities (%)

1 week YTD

	1 week	YTD
BBG Com Ind	2.1	34.2
Oil (WTI)	3.7	73.4
Gold	0.6	-7.3

Currencies (USD) (%)

1 week YTD

	1 week	YTD
EM FX	0.3	-3.6
AUD	1.5	-3.8
CAD	0.8	3.1
CHF	0.4	-4.2
EUR	0.3	-5.1
GBP	1.0	0.7
JPY	-1.8	-9.5

U.S. economy

GDP

Jobs

Inflation

Ex-U.S.

Regions/countries

	GDP Growth (%) annualized	Inflation Rate (%) CPI	Unemployment Rate (%)	10-Year Government Bond (%)	Sovereign Credit Rating
Eurozone	14.3	3.4	7.5	_	_
China	7.9	0.7	5.1	2.99	A+
Germany	9.4	4.1	3.6	-0.16	AAA
Japan	7.6	-0.4	2.8	0.08	A+
U.K.	23.6	3.2	4.5	1.10	AA

GDP Growth (%) annualized
Eurozone	14.3
China	7.9
Germany	9.4
Japan	7.6
U.K.	23.6

Inflation Rate (%) CPI
Eurozone	3.4
China	0.7
Germany	4.1
Japan	-0.4
U.K.	3.2

Unemployment Rate (%)
Eurozone	7.5
China	5.1
Germany	3.6
Japan	2.8
U.K.	4.5

10-Year Government Bond (%)
Eurozone	_
China	2.99
Germany	-0.16
Japan	0.08
U.K.	1.10

Sovereign Credit Rating
Eurozone	_
China	A+
Germany	AAA
Japan	A+
U.K.	AA

Fund industry overview

Total net flows: open-end funds and ETFs as of 8/31/21 ($B)

as tracked by ISS Market Intelligence SIMFUND

MONTH 12 Month ASSETS

	MONTH	12 Month	ASSETS
U.S. Equity	4.6	24.9	12,783.4
Sector Equity	4.8	102.8	1,399.0
Allocation	0.6	-22.5	1,503.9
International Equity	23.9	188.8	4,278.4
Alternative	2.9	22.1	128.1
Commodities	-1.1	0.0	173.4
Taxable Bond	47.0	669.9	5,455.4
Municipal Bond	11.0	119.9	1043.8
Total all long-term funds	93.2	1,065.1	26,891.3

Leading Morningstar fund categories by monthly net flows as of 8/31/21 ($B)

	MONTH	12 Month	ASSETS
Large Blend	13.8	39.4	5,882.2
Foreign Large Blend	12.9	58.0	1,433.6
Short-Term Bond	7.5	115.8	600.4
Diversified Emerging Mkts	5.9	59.3	761.0
Intermediate Core Bond	5.2	174.4	1,245.8

Lagging Morningstar fund categories by monthly net flows as of 8/31/21 ($B)

	MONTH	12 Month	ASSETS
Mid-Cap Growth	-4.1	-3.7	693.7
Large Growth	-3.8	-78.8	2,739.0
Small Growth	-2.8	-1.7	333.6
Trading--Leveraged Equity	-2.8	-6.0	64.7
Commodities Focused	-2.2	-15.8	121.5

Unless otherwise noted, all data is from FactSet.

Note: Totals displayed do not repsent the sum of the columns due to miscellaneous funds not assigned to a Morningstar category.

The Treasury yield curve is derived from available U.S. Treasury securities trading in the market and is provided directly from the U.S. Federal Reserve. The spread measures the difference in yield between two government securities. A normal (positive) yield curve occurs when longer-term rates are higher than shorter-term rates. The opposite holds true for an inverted yield curve. Year-to-date changes in U.S. Treasury bond yields are shown in basis points (bps). One hundred basis points equals one percent.

Oil prices are represented by West Texas Intermediate (WTI) crude oil.

The G20 countries comprise a mix of the world’s largest advanced and emerging economies, representing about two-thirds of the world’s population, 85% of global GDP, and over 75% of global trade.

Get Weekly Market Recap delivered to your inbox

Sign up to receive an email each Monday morning with top market news, data, and a calendar of the new week’s economic reports.

SUBSCRIBE HERE

Latest viewpoints All viewpoints All viewpoints

October 14, 2021

Fascination with inflation: Three-minute macro

Frances Donald, Global Chief Economist and Global Head of Macroeconomic Strategy, Multi-Asset Solutions Team Manulife Investment Management

Erica Camilleri, Investment Analyst Manulife Investment Management

Inflation is top of mind, and for good reason. This month's three-minute macro dives into three inflation stories.

October 14, 2021

Banks are back: a look at three stages of U.S. bank recovery

Ryan P. Lentell, CFA, Portfolio Manager, Capital Appreciation Manulife Investment Management

Susan A. Curry, Senior Portfolio Manager, Capital Appreciation Manulife Investment Management

A year and a half into the pandemic, U.S. bank stocks have proved resilient. Two industry specialists explain why they maintain a favorable view of the segment.

October 12, 2021

Portfolio Intelligence podcast: how advisors are using technology to help clients

John P. Bryson, Head of Investment Consulting John Hancock Investment Management

Smart use of technology and social media is critical for investment professionals to help clients and grow business. Hear from Brendan Barca, who teaches advisors how to seamlessly enter the digital age.

From Twitter MORE TWEETS