Markets took off this week following a competitive election cycle. Will the markets continue to soar?
Monday S&P 500 -0.28% | NASDAQ -0.33%
This is a big week for markets as political and monetary policy decisions become front and center. The anticipation for the election outcome and the Federal Reserve Banks decision to cut rates will test the resilience of the broader market sentiment. Markets traded in the red to start the week.
Tuesday S&P 500 1.23% | NASDAQ 1.43%
Markets recovered Monday’s losses and proceeded to gain further on the day. Election day jitters appeared to fade as votes were cast to decide potential changes in power. Technology stocks led the way as markets gained ground. In a rate cut environment, coupled with continuing earnings strength, the broad market was pushed higher.
Wednesday S&P 500 2.53% | NASDAQ 2.95%
Markets launched into the stratosphere on Wednesday morning after the election results poured in. Most states had reported final ballots, and the result was upbeat for markets. Specific policy making by the incoming administration remains to be seen but the initial response was quite positive. Bond prices fell on the day (with yields rising), the U.S. Dollar strengthened, and equity markets surged. The Dow Jones Industrial Average rose into record territory while the Russell 2000 Index (Small Cap Stocks) piled on gains through the close.
Thursday S&P 500 0.74% | NASDAQ 1.51%
Market activity accelerated as optimism grew on the prospect of sustained growth. The Federal reserve decided to cut interest rates, as expected, by another .25% (25bps). The post-meeting commentary has grown in favor of the long-sought-after soft landing in the eyes of the Federal Reserve Bank. The 10-year Treasury fell .11% on the day as equity buy orders continued.
Friday S&P 500 0.38% | NASDAQ 0.09%
Consumer sentiment rose as the primary data release for the day and markets finished the week in the positive on the day. The S&P500 closed within points of the coveted 6,000 mark while the Dow Jones inched closer to the 44,000 milestone.
Conclusion S&P 500 4.66% | NASDAQ 5.74%
Markets ended the week on a tear as the highly anticipated outcome of the election finally arrived. As is the case with any election, there are opportunities for portfolios and the investment community to make tactical moves. The overwhelming gains were noticed in large and small-cap companies, and specific sectors including financials, industrials, and consumer discretionary. The noticeable area that pulled back was the bond markets as government spending has soared to the top of the priority list as of late. Equities finished strong throughout the week as the Federal Reserve cut rates again which was widely anticipated and corporate earnings continue to roll in. All factors are good indicators of growth especially as we enter the 2nd half of the 4th quarter. The growth outlook appears to be blasting sky-high, but caution should be exercised as a soft-landing continues to be priority #1.
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