By Bill Hornbarger, Chief Investment Officer
Three Things to Know
- Global stocks gained $1.5 trillion last week and hit a new all-time high in terms of market capitalization. Global stocks are now worth $111 trillion and the market cap is up almost $8 trillion in 2021 and $50 trillion since the March 2020 lows. (Source: Bloomberg)
- The one-year return from last March’s bottom for the S&P 500 was 75% (exclusive of dividends). How does the market perform after such large gains? The average gain following a 12-month increase of 50% or more since 1950 has been -1.5%. For three and five-years the average return for the same time period has been 42.4% and 65.6% respectively. (Source: Ben Carlson, A wealth of Common Sense)
- For the first-ever flight on another world, the Ingenuity helicopter on Mars carries with it a small piece of the Wright Brothers’ first airplane. NASA’s Ingenuity Mars Helicopter carries a small swatch of muslin material from the lower-left wing of the Wright Brothers Flyer 1. The swatch of material from the Wright brothers’ first airplane was obtained from the Carillon Historical Park, in Dayton, Ohio — home to the Wright Brothers National Museum. (Source: NASA)
Three Things to Watch
- Earnings season kicks off this week, led by several high profile financial companies including JP Morgan Chase, Wells Fargo, Citigroup, and Goldman Sachs. Outside of the financial sector, PepsiCo and Delta Airlines report. Last quarter, about 80% of companies beat earnings estimates in Q4, but only 42% saw a share price increase on earnings day.
- There is a busy economic calendar this week with CPI (Tuesday) and Retail Sales (Thursday) most closely watched. Inflation concerns have been one of the factors behind the bond market’s recent performance with yields rising rapidly and retail sales should be strong from the effects of the latest round of stimulus checks.
- The Treasury will auction $58 billion and $38 billion of three and 10-year notes on Monday and $24 billion of 30-year bonds on Tuesday. The “when issued” 10-year note yields 1.67%, slightly below the 1.74% recent high.
The above information reflects the current opinion of the author. It is based upon sources and data believed to be accurate and reliable. Opinions and forward looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security mentioned.