Shrugging off COVID-19 infections and the disruption at the Capitol on January 6, stocks powered higher to kick off a new year of trading.
The Dow Jones Industrial Average gained 1.61%, while the Standard & Poor’s 500 increased by 1.83%. The Nasdaq Composite index, which led throughout 2020, picked up 2.43%. The MSCI EAFE index, which tracks developed overseas stock markets, rose 1.45%.1,2,3
Fireworks to Start the New Year
Stocks got off to an inauspicious start amid the stuttering pace of vaccine distribution and concern that the economic recovery might take longer than anticipated. Uncertainty over the looming Senate runoff election in Georgia added to the broad retreat that marked the first day of 2021 trading.
From there markets turned higher, aided by firming oil prices with subsequent support provided by the Georgia Senate election results, which lifted hopes of additional fiscal stimulus. Stocks managed through political unrest mid-week, with banks, economically sensitive stocks, and technology shares leading the way.
The yield on the 10-year Treasury rose above 1% for the first time since March as investors fled bonds in anticipation of new federal borrowing.4
Stocks touched all-time highs on the final trading day, capping a strong week of performance.5
The U.S. economy lost 140,000 jobs in December, confirming fears of economic slowdown brought on by a resurgence of COVID-19 infections.
Not surprisingly, it was restaurants and bars that saw the greatest job losses, with the larger hospitality sector accounting for nearly all the job losses last month. Meanwhile, November job creation was revised upward, from 245,000 to 336,000.6
To help put the pandemic in perspective, December’s job report capped the worst year for job losses since the tracking began in 1939. The unemployment rate remained unchanged at 6.7%.7
This Week: Key Economic Data
Tuesday: Job Openings and Labor Turnover Survey (JOLTS).
Wednesday: Consumer Price Index (CPI).
Thursday: Initial Jobless Claims.
Friday: Retail Sales, Consumer Sentiment, Industrial Production.
Source: Econoday, January 8, 2021
This Week: Companies Reporting Earnings
Tuesday: KB Home (KBH)
Thursday: Blackrock (BLK)
Friday: JPMorgan Chase (JPM), Citigroup (C), PNC Financial (PNC)
Source: Zacks, January 8, 2021
“Fun is a good thing, but only when it spoils nothing better.”
– George Santayana
Tax Tips for Those in the Military
The Internal Revenue Service has certain special tax breaks and programs for members of the U.S. Armed Forces. Here are just a few.
Earned Income Tax Credit
Signing Joint Returns
* This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax professional.
Tip adapted from IRS8
Stay Healthy During Flu Season
This flu season, it’s more important than ever to stay healthy. Fortunately, with a few simple steps, you may reduce your risk this flu season.
While this information should not substitute for medical advice from your healthcare provider, implementing better habits, like frequent handwashing, wearing a face mask, and avoiding anyone who is ill, may help you and your loved ones stay healthy this flu season.
Tip adapted from Centers for Disease Control and Prevention9
Yesterday was Wednesday’s tomorrow. Tomorrow is Sunday’s yesterday. Given those circumstances, what day would today be?
Last week’s riddle: The railings on a 60-yard-long walkway have ornamental sculptures every 12 yards on both sides, starting at the east and west ends of the walkway. How many total sculptures are there on the walkway? Answer: 12 sculptures total, as there are 6 per side if they occur every 12 yards (0-12-24-36-48-60).
Pictured Rocks National Lakeshore, Munising, Michigan.
Footnotes and Sources
1. The Wall Street Journal, January 8, 2021
2. The Wall Street Journal, January 8, 2021
3. The Wall Street Journal, January 8, 2021
4. The Wall Street Journal, January 6, 2021
5. CNBC, January 8, 2021
6. The Wall Street Journal, January 8, 2021
7. The Wall Street Journal, January 8, 2021
8. IRS.gov, January 8, 2021
9. CDC.gov, September 25, 2020
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