Retail Sales Rebound | Daily Market Update

Wednesday, February 17, 2021

Top Story

Retail sales rebound in January. US retail sales rose 5.3% month over month in January according to the US Census Bureau, ahead of Bloomberg consensus forecasts of 1.1%. The surge in retail sales was the highest in seven months, a strong response following December’s 1% decline as fresh stimulus checks helped spur consumer demand following the headwinds caused by rising COVID-19 cases at the end of 2020. Further, strong January retail sales should remove much of the risk for the US economy to stall in the first quarter of 2021.

Daily Insights

US stocks opened lower as yields slip from highest level since February 2020

  • European markets modestly lower on softer than expected retail earnings
  • Asian markets mixed overnight with the Hang Seng Index outperforming

Crude up again. West Texas Intermediate crude oil (WTI) is above $60/barrel and up another 1% this morning, with multiple drivers.

  • Historically cold weather in Texas has limited overall US production by approximately one-third.
  • Global demand from India and China are quickly improving, while OPEC production cuts from last year are still in play.
  • We’ve grown more optimistic on energy recently. We upgraded our view on crude oil, and then this month upgraded our view on energy stocks at the start of 2021. Read more about these upgrades and the reasons why in our Global Portfolio Strategy.

Is this really a calm stock market? There is plenty of talk how volatile things are, but we’d say things are actually quite calm.

  • The CBOE Volatility Index (VIX) recently closed beneath 20 for the first time since before the pandemic.
  • The past 3 times the S&P 500 Index was lower were by only 0.06%, 0.03%, and 0.11%. The last time three days were lower by that small of an amount was in December 2019.

Technical update. Large cap indexes were little changed Tuesday; however, energy returned 2.3% and financials gained 1.8%. The S&P 500 Index Financials sector has gained 10.7% so far in February, decisively breaking out above the 2007, 2018 and 2020 highs for the sector.

COVID-19 news

The United States reported 56,000 new COVID-19 cases, down 39% week over week, although severe weather in the Midwest may be affecting reports (source: COVID Tracking Project).

  • The European Union finalized an agreement with Pfizer/BioNTech for an additional 200 million vaccine doses.
  • Japan begins first doses of vaccine administration following last week’s approval of the Pfizer/BioNTech vaccine.

Street View video: Three Types of Lies

LPL Financial Research Chief Market Strategist Ryan Detrick illustrates how you can take any data and tell any story you want, but when you want to invest, you want to know what really matters. Watch the new Market Signals Podcast here!

The Search For Income

LPL Research considers unique income ideas for diversifying investor portfolios & potentially reducing interest rate risk. Learn what they are in this week’s Market Signals podcast, Finding Yield in a Low Yield World.



This material is for general information only and is not intended to provide specific advice or recommendations for any individual. There is no assurance that the views or strategies discussed are suitable for all investors or will yield positive outcomes. Investing involves risks including possible loss of principal. Any economic forecasts set forth may not develop as predicted and are subject to change.

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.

Any company names noted herein are for educational purposes only and not an indication of trading intent or a solicitation of their products or services. LPL Financial doesn’t provide research on individual equities.

All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.

All index and market data are from FactSet and MarketWatch.

This Research material was prepared by LPL Financial, LLC.

Securities and advisory services offered through LPL Financial (LPL), a registered investment advisor and broker-dealer (member FINRA/SIPC).

Insurance products are offered through LPL or its licensed affiliates.  To the extent you are receiving investment advice from a separately registered independent investment advisor that is not an LPL affiliate, please note LPL makes no representation with respect to such entity.

  • Not Insured by FDIC/NCUA or Any Other Government Agency
  • Not Bank/Credit Union Guaranteed
  • Not Bank/Credit Union Deposits or Obligations
  • May Lose Value

For Public Use – Tracking # 1- 05112341