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Investment Update

Updated December 4, 2020

Our investment team remains committed to helping you achieve your goals. We are constantly monitoring and evaluating the markets to provide you the most relevant financial information and how we look ahead from here.

November Stock Market Surge

Equity markets enjoyed a historically good month in November. With much of the uncertainty regarding the elections removed, positive vaccine news on multiple fronts and unprecedented stimulus from central banks, equity markets saw double-digit gains. The Dow Jones Industrial Average had its best monthly gain since 1987, rising 11.8 percent. The S&P 500 was up 10.8 percent and the Nasdaq Composite gained 11.8 percent.

Whereas much of the gains earlier this year were focused in a small group of large-cap growth stocks, this rally was broad based. The MSCI Emerging Markets Index was up 9.2 percent and the small-cap Russell 2000 Index had its best month ever, rising 18.4 percent.

Positive News Continues on the Vaccine Front

The United Kingdom authorized the Pfizer/BioNTech COVID-19 vaccine for emergency use this week, becoming the first Western country to approve a vaccine. A panel of experts for the Food and Drug Administration will review the vaccine on December 10, and authorization in the U.S. may follow soon after. Health experts anticipate 20 million doses will be available by the end of the year, ramping up to hundreds of millions in 2021. This followed announcements of positive results on other vaccines over the last few weeks. The Centers for Disease Control and Prevention released guidance that healthcare workers and nursing home residents should be the first to get vaccines .

Housing Market Remains Hot

Record-low mortgage rates, millennial increases in homeownership and the nesting effect caused by the COVID-19 crisis are driving a strong housing market. Existing home sales were up 26.6 percent year-over-year in October and existing home prices were up 15.4 percent year-over-year.

Prices are at record highs and inventories are at record lows. Lack of supply appears to be the only thing holding back the housing market at this point, which will spur more new home construction. Home purchases lead to increased economic activity including furniture and appliance purchases, landscaping and other home improvements. A robust housing market also provides a boost for lawyers, real estate agents and property assessors.

COVID-19 During the Holiday Season

The seven-day average number of new COVID-19 cases resumed its upward trend following a pause during the Thanksgiving holiday period, as many testing sites were closed and reporting may have been delayed. The rate of growth has declined over the last couple of weeks, however. Hospitalizations and deaths, which have lagged case numbers, unfortunately hit new highs this week.

Untraditional Black Friday

Traffic in physical stores plummeted 52 percent, according to retail tracker Sensormatic Solutions. However, online sales surged. Adobe Analytics reports Black Friday online sales increased 22 percent. The National Retail Federation predicted holiday sales will increase between 3.6 and 5.2 percent this year. Last year’s holiday sales were up 4 percent.

What Should I Be Doing With My Investments?

We encourage you to pay attention to the latest developments, but not to lose sight of your long-term investment strategy. Reach out to our investment team to discuss your options and reaffirm your timeline and goals. Call our investment team at (518) 415-4401.