Daily Market Update
COVID-19 May Threaten the Recovery
The stock market doesn’t appear fazed by the recent increase in COVID-19 outbreaks, but underlying economic data is beginning to reflect the latest government and consumer shutdowns. LPL Research’s Weekly Market Commentary explains potential economic effects of another lockdown.
Stocks off to a strong start in December. The S&P 500 Index is following global stocks higher at open as we enter the final month of the year.
- Positive Asian manufacturing data helped spur international stocks overnight.
- China, Japan, and South Korea were all up over 1%.
- Europe is showing solid gains at midday.
Credit spreads have moved below historical averages.
- Both investment-grade and high-yield corporate bond credit spreads have moved below historical averages, as measured by Bloomberg Barclays indexes.
- Credit spreads have tightened quickly from their widest levels, reaching a level in months that took years after the 2008–09 recession.
- We believe the current level still represents something close to fair value for early cycle, although there are risks from economic uncertainty around the latest COVID-19 surge.
November was a record-breaking month. Thanks to gridlock in Washington and positive vaccine news, November was a record-breaking month for stocks.
- Best month for Dow since January 1987 (11.9%) and best November since 1928
- Best month ever for the STOXX 600 (16.7%)
- Best month ever for the Russell 2000 (18.3%)
- Best month for the S&P 500 (10.8%) and Nasdaq (11.8%) since April 2020
- Best month for Dow Transports since October 2011 (12.1%)
- Best month from PHLX Semiconductor Index since March 2003 (18.4%)
- Best month for Industrials (16.0%) and Financials (16.8%) since April 2009
- Second best month ever for energy (28.0%)
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References to markets, asset classes, and sectors are generally regarding the corresponding market index. Indexes are unmanaged statistical composites and cannot be invested into directly. Index performance is not indicative of the performance of any investment and do not reflect fees, expenses, or sales charges. All performance referenced is historical and is no guarantee of future results.
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All index and market data are from FactSet and MarketWatch.
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