Weekly Market Recap

Week ended October 15

Market-moving news

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.

Market-moving news
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. 

Market-moving news
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%.

Market-moving news
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. 

Market-moving news
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.

Market-moving news
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%.

Market-moving news
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. 

Market-moving news
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
1.42.02.6 Large
1.72.33.4 Mid
1.01.51.9 Small
Value Core Growth
YTD
20.719.818.9 Large
23.520.114.0 Mid
27.215.65.1 Small
Value Core Growth
Index/market total returns as of 10/15/21 (%)
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
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
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
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
0.0-0.22.0 High
-0.10.01.8 Med QUALITY
0.00.20.4 Low
Ltd Int Long
INTEREST-RATE SENSITIVITY
YTD
0.0-1.5-7.0 High
-0.2-1.1-0.6 Med QUALITY
5.34.57.0 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)
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
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
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
BBG Com Ind 2.1 34.2
Oil (WTI) 3.7 73.4
Gold 0.6 -7.3
Currencies (USD) (%)
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

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
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 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. 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 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.



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