Last Week Recap:
Markets were up big last week, S&P 500 4.65%, Dow 3.89%, Nasdaq 6.01%, Russell 2000 7.70%, as earnings continued to beat expectations, the $1.9M stimulus package looks like it may move forward, Covid cases/hospitalizations are down and vaccine distribution is up, and after the markets moved past impacts of last weeks "retail bros" short-squeeze drama. Earnings for the fourth quarter were expected to be lower than a year earlier, however with about 59% of companies reporting better than expected results, earnings are now expected to be 1.7% higher than last year. Last weeks jobs report was worse than expected, however the markets look to that as a greater likelihood that we will see further fiscal stimulus. Oil and interest rates were also up significantly on the week. Both are signs that the markets is in anticipating further economic growth as the world recovers from the pandemic.
The Week Ahead:
Earnings will continue this week, as will the focus on the next stimulus package as well as updates on progress towards the pandemic. Although, it has been a long time since runaway inflation has been an issue in this country, investors have taken a new interest in discussing the impacts of the country continuing to take on such extraordinary debt levels. This week we will get the last CPI numbers. We will also get a report on consumer sentiment.
Sources: Seeking Alpha, TD Ameritrade, StockTwits
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