Weekly Market Recap

Week ended November 26

Capital market performance report

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

Market-moving news

Pandemic sell-off

The discovery of a new highly transmissible coronavirus variant in South Africa upended what had been a fairly quiet week for financial markets. A steep sell-off on Friday left U.S. large-cap stock indexes with weekly declines ranging from around 2.0% to 3.5%; a small-cap benchmark dropped 4.1%.

Oil slick

Fears stemming from the new coronavirus variant sent U.S. crude oil prices down 12% on Friday. The price fell to around $69 per barrel—the lowest level in more than two and a half months—as several nations banned air travel from countries in Southern Africa in hopes of containing the variant’s spread.

Rough ride ahead?

A measure of investors’ expectations of short-term U.S. stock market volatility surged 54% on Friday amid news about yet another coronavirus variant. The Cboe Volatility Index—also known as the VIX—jumped to nearly 29, the highest level in nine months.

Yield volatility

Yields of government bonds sharply reversed course in response to the emergence of a new coronavirus variant and its potential impact on the outlook for interest rates. Bond prices fell early in the week, pushing the yield of the 10-year U.S. Treasury bond up to 1.65% on Wednesday. On Friday, prices surged, and the yield tumbled to 1.48%.

Fed chair renominated

President Biden nominated Federal Reserve Chair Jerome Powell to serve a second four-year term as head of the nation’s central bank, lifting expectations of policy stability as the Fed seeks to contain rising inflation. The nomination is widely expected to be approved by the Senate, and Powell’s new term would begin in February 2022.

Healing labor market

The number of Americans applying for unemployment benefits fell to the lowest weekly total since 1969, marking the eighth consecutive weekly decline. The 199,000 filings in the latest weekly count was down from 270,000 the previous week and was far below economists’ expectations.

Fed's rate outlook

At their meeting earlier this month, Federal Reserve officials expressed concern about the persistence of rising inflation and discussed whether they should prepare to raise interest rates in the first half of next year. The release on Wednesday of minutes from the early November meeting showed that some officials wanted to end the Fed’s asset purchase program sooner than June 2022 in case they feel greater urgency to raise rates once the program wraps up.

Jobs ahead

A monthly labor market update due out on Friday is likely to be the week’s most closely watched economic report. The data will show whether November maintained the pace of job growth seen in October, when the economy generated 531,000 new jobs—the biggest gain in three months—and unemployment fell to 4.6% from 4.8%.

The week ahead: November 29-December 3

Monday

Pending home sales, National Association of Realtors

Tuesday

S&P/Case-Shiller 20-City Composite Home Price Index
Consumer Confidence Index, The Conference Board

Wednesday

ADP National Employment Report, ADP
Institute for Supply Management’s manufacturing index
Construction spending, U.S. Census Bureau

Thursday

Weekly unemployment claims, U.S. Department of Labor

Friday

Jobs and unemployment, U.S. Bureau of Labor Statistics
Factory orders, U.S. Census Bureau
Institute for Supply Management’s nonmanufacturing index

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 11/26/21 (%)

1 week YTD

1 week
-1.2	-2.3	-3.3	Large
-2.0	-2.5	-3.5	Mid
-3.3	-4.1	-4.9	Small
Value	Core	Growth

YTD
20.1	22.5	24.6	Large
23.5	20.2	14.1	Mid
26.5	14.7	4.0	Small
Value	Core	Growth

Index/market total returns as of 11/26/21 (%)

Close Week YTD

	Close	Week	YTD
Dow Jones Industrial Average	34,899.3	-2.0	15.9
NASDAQ Composite Index	15,491.7	-3.5	20.9
S&P 500 Index	4,594.6	-2.2	23.9
MSCI EAFE Index	2,305.5	-3.7	7.9
Cboe Volatility Index	28.6	59.8	25.4

International/developed (%)

1 week YTD

	1 week	YTD
EAFE	-3.7	7.9
Europe	-4.4	10.6
France	-4.9	13.5
Germany	-5.6	1.9
Italy	-4.4	9.3
Japan	-2.3	3.4
Spain	-4.2	-2.9
Switzerland	-2.6	12.5
U.K.	-3.2	11.0

Emerging markets (%)

1 week YTD

	1 week	YTD
EM	-3.6	-3.2
Brazil	-0.4	-19.7
China	-3.6	-17.8
India	-4.8	23.0
Indonesia	-2.4	2.6
Korea	-1.7	-11.4
Mexico	-6.2	5.9
Russia	-7.7	18.0
Taiwan	-3.1	20.0

S&P 500 sectors (%)

1 week YTD

	1 week	YTD
S&P 500 Index	-2.2	23.9
Communication services	-3.3	20.9
Consumer discretionary	-3.6	24.5
Consumer staples	-0.2	9.9
Energy	1.7	52.8
Financials	-0.6	33.5
Healthcare	-0.8	17.6
Industrials	-2.4	17.7
Information tech	-3.2	28.0
Materials	-2.2	20.6
Real estate	-0.9	33.7
Utilities	-0.9	8.9

Fixed income, currencies, and commodities

U.S. fixed-income style total returns as of 11/26/21 (%)

1 week YTD

1 week
0.0	0.2	1.3	High
0.1	0.0	-0.1	Med	QUALITY
-0.5	-1.2	-2.0	Low
Ltd	Int	Long
INTEREST-RATE SENSITIVITY

YTD
0.0	-1.5	-3.9	High
-0.4	-1.3	0.2	Med	QUALITY
4.8	3.2	6.1	Low
Ltd	Int	Long
INTEREST-RATE SENSITIVITY

U.S. Treasury bond yields as of 11/26/21 (%)

END OF WEEK PRIOR YEAR END YTD CHANGE (BPS)

	END OF WEEK	PRIOR YEAR END	YTD CHANGE (BPS)
2 Yr	0.50	0.12	38
10 Yr	1.48	0.92	56
30 Yr	1.83	1.65	18
2-10 spread	0.98	0.80	18
10-30 spread	0.35	0.73	-38

U.S. bond sector total returns (%)

1 week YTD

	1 week	YTD
Aggregate	0.1	-1.5
Bank loans	-0.2	2.0
Convertible	-1.2	7.3
Corporate	-0.2	-2.3
High yield	-1.2	3.2
MBS	-0.1	-1.1
Municipal	0.1	1.2
Preferreds	-1.1	-1.3
TIPS	-0.3	5.8
Treasury	0.4	-2.0

Global bond total returns (%)

1 week YTD

	1 week	YTD
EM Local	-1.9	-11.7
EMD USD	-1.7	-3.2
Global Agg	0.0	-4.6
Global Agg Ex-U.S.	-0.1	-6.2
Multiverse	-0.1	-4.5

Commodities (%)

1 week YTD

	1 week	YTD
BBG Com Ind	-2.2	28.3
Oil (WTI)	-10.3	46.1
Gold	-3.6	-6.4

Currencies (USD) (%)

1 week YTD

	1 week	YTD
EM FX	-1.2	-6.7
AUD	-1.8	-7.6
CAD	-1.1	-0.4
CHF	0.5	-4.2
EUR	0.0	-7.5
GBP	-0.9	-2.4
JPY	0.6	-8.8

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	3.7	4.1	7.4	_	_
China	4.9	1.5	4.9	2.87	A+
Germany	2.5	4.5	3.4	-0.34	AAA
Japan	1.4	0.1	2.8	0.07	A+
U.K.	6.6	4.2	4.3	0.83	AA

GDP Growth (%) annualized
Eurozone	3.7
China	4.9
Germany	2.5
Japan	1.4
U.K.	6.6

Inflation Rate (%) CPI
Eurozone	4.1
China	1.5
Germany	4.5
Japan	0.1
U.K.	4.2

Unemployment Rate (%)
Eurozone	7.4
China	4.9
Germany	3.4
Japan	2.8
U.K.	4.3

10-Year Government Bond (%)
Eurozone	_
China	2.87
Germany	-0.34
Japan	0.07
U.K.	0.83

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 10/31/21 ($B)

as tracked by ISS Market Intelligence SIMFUND

MONTH 12 Month ASSETS

	MONTH	12 Month	ASSETS
U.S. Equity	26.5	109.1	13,016.9
Sector Equity	6.0	115.7	1,424.0
Allocation	-1.0	-10.2	1,510.4
International Equity	13.8	215.3	4,257.9
Alternative	3.8	26.3	135.9
Commodities	-0.6	-2.3	173.6
Taxable Bond	30.5	633.6	5477.8
Municipal Bond	3.0	116.3	1,043.5
Total all long-term funds	83.3	1180.5	27,178.1

Leading Morningstar fund categories by monthly net flows as of 10/31/21 ($B)

	MONTH	12 Month	ASSETS
Large Blend	22.6	83.5	6,003.3
Foreign Large Blend	11.6	73.9	1,437.9
Inflation-Protected Bond	8.7	70.7	276.7
Intermediate Core Bond	8.1	156.7	1,236.0
Long Government	4.5	9.0	78.8

Lagging Morningstar fund categories by monthly net flows as of 10/31/21 ($B)

	MONTH	12 Month	ASSETS
Intermediate Core-Plus Bond	-2.4	68.0	857.0
Small Growth	-2.2	-2.9	335.5
Trading--Leveraged Equity	-2.0	-4.6	71.6
Corporate Bond	-1.6	-6.5	213.4
Health	-1.4	5.4	252.6

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.

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