Weekly Investment Update September 21, 2020

September 21, 2020

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Weekly Investment Update

US equity markets, as measured by the S&P 500 index, were down slightly last week.  On Wednesday, Federal Reserve Chair, Jerome Powell, announced that it intends to keep interest rates near zero through at least 2023, confirming its very accommodative stance toward monetary policy will be in place for significantly longer.  The Fed also said in its meeting minutes that it does not expect inflation to consistently meet the 2% target until 2023, potentially an implication that the group does not expect a robust economic recovery in the near future.[1]

The Commerce Department announced Thursday that housing starts fell 5.1% in August to a seasonally adjusted annual rate of 1.42 million.  The pause comes after three months of increases in housing, and the rate is meaningfully higher than August 2019.  Looking forward, single family permits for new homes increased 6% to an annual rate of 1.04 million.[2]  Like housing, the labor market continues to improve, albeit at a slowing pace.  Last week, another 860,000 people filed initial claims for unemployment insurance benefits, and continuing claims for benefits remain elevated at 12.63 million people, down approximately 900,000 from the previous week.  The economic calendar is relatively light this week, potentially one of the last quiet periods for markets as Q3 earnings season will soon begin as well as the run up to the 2020 Presidential election.

Key Economic Releases This Week

Asset Class Returns

Prices & Interest Rates

 

[1] https://www.federalreserve.gov/newsevents/pressreleases/monetary20200916a.htm

[2] https://www.cnbc.com/2020/09/17/housing-starts-august-2020.html

Past performance may not be representative of future results.  All investments are subject to loss.  Forecasts regarding the market or economy are subject to a wide range of possible outcomes.  The views presented in this market update may prove to be inaccurate for a variety of factors.  These views are as of the date listed above and are subject to change based on changes in fundamental economic or market-related data.  Please contact your Financial Advisor in order to complete an updated risk assessment to ensure that your investment allocation is appropriate.   

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US equity markets, as measured by the S&P 500 index, were down slightly last week.\u00a0 On Wednesday, Federal Reserve Chair, Jerome Powell, announced that it intends to keep interest rates near zero through at least 2023, confirming its very accommodative stance toward monetary policy will be in place for significantly longer.\u00a0 The Fed also said in its meeting minutes that it does not expect inflation to consistently meet the 2% target until 2023, potentially an implication that the group does not expect a robust economic recovery in the near future.[1]\n

The Commerce Department announced Thursday that housing starts fell 5.1% in August to a seasonally adjusted annual rate of 1.42 million.\u00a0 The pause comes after three months of increases in housing, and the rate is meaningfully higher than August 2019.\u00a0 Looking forward, single family permits for new homes increased 6% to an annual rate of 1.04 million.[2]\u00a0 Like housing, the labor market continues to improve, albeit at a slowing pace.\u00a0 Last week, another 860,000 people filed initial claims for unemployment insurance benefits, and continuing claims for benefits remain elevated at 12.63 million people, down approximately 900,000 from the previous week.\u00a0 The economic calendar is relatively light this week, potentially one of the last quiet periods for markets as Q3 earnings season will soon begin as well as the run up to the 2020 Presidential election.\n

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Key Economic Releases This Week”}},{“type”:”image”,”props”:{“margin”:”default”,”image_svg_color”:”emphasis”,”image”:”wp-content\/uploads\/2020\/09\/Key-Economic-Releases-This-Week-9-21-2020-2.png”}},{“type”:”text”,”props”:{“margin”:”default”,”column_breakpoint”:”m”,”content”:”

Asset Class Returns”}},{“type”:”image”,”props”:{“margin”:”default”,”image_svg_color”:”emphasis”,”image”:”wp-content\/uploads\/2020\/09\/Asset-Class-Returns-9-21-2020-1.png”}},{“type”:”text”,”props”:{“margin”:”default”,”column_breakpoint”:”m”,”content”:”

Prices & Interest Rates”}},{“type”:”image”,”props”:{“margin”:”default”,”image_svg_color”:”emphasis”,”text_align”:”left”,”image”:”wp-content\/uploads\/2020\/09\/Prices-Interest-Rates-9-21-2020-1.png”}},{“type”:”text”,”props”:{“margin”:”default”,”column_breakpoint”:”m”,”text_size”:”small”,”content”:”

\u00a0\n

[1] https:\/\/www.federalreserve.gov\/newsevents\/pressreleases\/monetary20200916a.htm\n

[2] https:\/\/www.cnbc.com\/2020\/09\/17\/housing-starts-august-2020.html”}},{“type”:”html”,”props”:{“content”:”

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Past performance may not be representative of future results. \u202fAll investments are subject to loss.\u202f Forecasts regarding the market or economy are subject to a wide range of possible outcomes. \u202fThe views presented in this market update may prove to be inaccurate for a variety of factors.\u202f These views are as of the date listed above and are subject to change based on changes in fundamental economic or market-related data. \u202fPlease contact your Financial Advisor in order to complete an updated risk assessment to ensure that your investment allocation is appropriate.\u202f\u202f\u00a0″,”text_align”:”left”,”text_size”:”small”,”text_color”:”muted”}}]}]}]}],”version”:”2.2.2″} –>

Past performance may not be representative of future results.  All investments are subject to loss.  Forecasts regarding the market or economy are subject to a wide range of possible outcomes.  The views presented in this market update may prove to be inaccurate for a variety of factors.  These views are as of the date listed above and are subject to change based on changes in fundamental economic or market-related data.  Please contact your Financial Advisor in order to complete an updated risk assessment to ensure that your investment allocation is appropriate.