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Market Recap Archive

February 19, 2021

The market experienced a slight decline this week, as higher dividend-paying stocks in real estate and utilities sectors underperformed due to the continued uptick in interest rates. Financials and energy experienced relative outperformance. Financials benefit from higher interest rates, and energy consumption increased due to frigid weather from unprecedented winter storms in areas such as Texas. Weekly jobless claims continue to remain at elevated levels (861,000). In the cryptocurrency market, Bitcoin crossed a notable milestone at over $1 trillion in market value. Next week, we look forward to data on durable goods, consumer confidence, and consumer spending. To learn more about how we help business owners, please click here: https://mybuckingham.com/services/business-services-and-tax-preparation.

Allen Thuma, CFA
Portfolio Manager & Research Analyst

Commentary Disclosures


February 12, 2021

The S&P 500 had a small gain this week, which was still heavy with quarterly earnings reports. Small cap, mid cap, and international stock indices set multi-year highs, gaining around 2%. The 10-year Treasury yield climbed to 1.20% for the first time since March. We are keeping a close eye on inflation data because higher inflation could push bond yields higher. This week’s update on consumer inflation, the Core CPI (Consumer Price Index) was still tame at 1.4%. Stock and bond markets will be closed on Monday in observance of Presidents’ Day (technically Washington’s Birthday per the NYSE). This Tuesday, February 16th, we will be hosting a webinar explaining SPACs (Special Purpose Acquisition Companies) and Bitcoin. You can register here: https://mybuckingham.com/events/the-year-of-the-spac-and-digital-currencies. If your needs are changing or if you would like more information on the markets or your portfolio, please call us at (937) 435-2742.

Ryan P. Johnson, CFA, CFP®
Director of Portfolio Management & Research

Commentary Disclosures


February 5, 2021

The S&P 500 gained over 4% this week, fully reversing last week’s loss while notching another new high. Last week’s headliner, Gamestock, was down over 80% this week. Silver, a target of the Reddit crowd early in the week, initially climbed 11% but ended the week with nearly no gain. A measure of stock volatility, the VIX index, fell sharply this week, more than reversing last week’s move. Several prominent CEOs announced their departures this week, including Jeff Bezos from Amazon and the leaders of Merck and UnitedHealth. This could signal companies are getting closer to an “after COVID” mindset as the long-tenured CEOs feel comfortable enough to pass control to the next generation. Today the monthly jobs report was released and it showed 49,000 jobs being added, with an improvement in the unemployment rate, which now stands at 6.3%. Another economic indicator, the Purchasing Managers’ Index (PMI), showed strength and the reading was better than expected. The PMI Purchasing Managers' Index (PMI) is a survey from over 400 companies and is considered a leading indicator for private sector services. Lastly, with nearly 300 of the S&P 500 companies having recently reported quarterly results, the earnings “surprise” rate is above normal, which is helping sustain higher stock prices. To learn more about how we help business owners, please click here: https://mybuckingham.com/services/business-services-and-tax-preparation.

Ryan P. Johnson, CFA, CFP®
Director of Portfolio Management & Research

Commentary Disclosures


January 29, 2021

Gamestonk!! No, that isn’t a typo, it references a tweet by Tesla CEO Elon Musk, and it represents how this week the market and the media were consumed with the trading action in highly-shorted small cap stocks like GameStop (GME). A quick summary: thousands of individual investors drove the price of a handful of stocks into the stratosphere, as it forced short-sellers to buy the stocks (they thought would go down) at higher and higher prices, creating an upward spiral. We have not seen an impact on our individual holdings. With our eye on the long-run for your investments, we will continue to focus on quality factors such as end-market growth, innovation, profitability, debt, and valuation. In the short-run, this wild activity in a small part of the market may shake overall confidence a bit, which could lead to lower valuations/prices. It certainly will impact the possible range of outcomes for modeling short-selling and for options pricing. Reiterating our long-term focus, we would like to note that the range of historic stock market returns narrows, and skews positive, as time horizons lengthen. For example, over the past 30 years, the 1-year return of the S&P 500 has ranged from -38% to +34%, but the annualized rolling 10-year returns have ranged from -3% to +20%. The S&P 500 again hit a new high this week, but overall had a loss of around 3%, as volatility increased to the highest since before the Presidential election. To learn more about how we help business owners, please click here: https://mybuckingham.com/services/business-services-and-tax-preparation.

Ryan P. Johnson, CFA, CFP®
Director of Portfolio Management & Research

Commentary Disclosures


January 22, 2021

In this 4-day trading week, due to the Martin Luther King Jr. Day holiday, stocks made fresh highs, gaining about 2%. Strength could be attributed to gains in large cap growth stocks such as Alphabet (Google), Facebook, Apple, Microsoft, and Amazon. Large cap value and growth performance leadership has been going back and forth for several months after growth handily outperformed in 2020. Volatility fell this week while interest rates stayed fairly steady. Corporate earnings season has begun, with several banks having recently reported, but the volume of companies reporting ramps up significantly next week. This Thursday we will also get the first read on Q4 GDP, which could be 4.4%.To learn more about how we help business owners, please click here: https://mybuckingham.com/services/business-services-and-tax-preparation.

Ryan P. Johnson, CFA, CFP®
Director of Portfolio Management & Research

Commentary Disclosures


January 15, 2021

The S&P 500 took a breather from the recent positive momentum and declined about 1% this week. Mid-cap and small-cap stocks, however, gained. On the economic front there were several reports released this week: weekly jobless claims and December retail sales disappointed, inflation remains contained though inflation expectations are increasing, and manufacturing saw strength. Federal Reserve Chairman Powell recently said that when the time comes to raise interest rates the Fed would, but that “is no time soon”. The Fed continues to buy at least $120 billion in bonds each month, which helps keep bond prices higher and interest rates lower. We had a webinar for small businesses this week and the replay can be found here: https://vimeo.com/channels/buckinghamvideolibrary. To learn more about our financial planning subscription service, please call (937) 435-2742.

Ryan P. Johnson, CFA, CFP®
Director of Portfolio Management & Research

Commentary Disclosures


January 8, 2021

Welcome to the new year! The positive momentum in the stock market continued as the S&P 500 set new highs this week, despite political changes and unrest seen in the capital. Many investors are expecting another round of stimulus. Interest rates rose as inflation expectations increased; the 10-year Treasury yield rose to 1.1%, the first time it has been over 1% since March. Today’s monthly jobs report showed the first net loss of jobs in many months, but the unemployment rate stayed the same at 6.7%. Stocks may be susceptible to a pullback with so much positive sentiment in the market, but even a 10% sell-off from here would put the S&P 500 above the pre-COVID highs from February 2020. We had two webinars this week, one about Financial Planning and the other about Investments, and the replays can be found here: https://vimeo.com/channels/buckinghamvideolibrary. We have another webinar on January 12th: “ The Latest Relief Package: What it Offers for Small Businesses” and you can register for it here: https://mybuckingham.com/events. To learn more about our financial planning subscription service, please call (937) 435-2742.

Ryan P. Johnson, CFA, CFP®
Director of Portfolio Management & Research

Commentary Disclosures


December 31, 2020

The S&P 500 ended the year on a high note, with a small gain this week and a total return of over 17% this year. Small cap and international stocks did well too with double-digit returns, on average. The latest government stimulus bill was finally passed and payments should be hitting bank accounts in the coming days. All eyes will be on Georgia Tuesday night for results from the special election to select the final two Senate seats, though official results may not be known for several days due to mail-in ballots. This week’s jobless claims figure was slightly better than expected but the 4-week moving average increased. This continues to make the case for a weaker monthly jobs report next Friday. We will have a trio of webinars to kick off the new year - please visit the Events tab on mybuckingham.com to sign up for any or all of the sessions that will cover topics for financial planning, investments, and small businesses. To learn more about our financial planning subscription service, please call (937) 435-2742.

Ryan P. Johnson, CFA, CFP®
Director of Portfolio Management & Research

Commentary Disclosures


December 24, 2020

The S&P 500 was down slightly this week after a loss on Monday, which came from the news that a more contagious variant of COVID-19 was found in the U.K. This led much of Europe to close its borders to the U.K. and raised fears that this version of COVID-19 would spread more quickly around the globe. Despite what seemed like a done deal between the House and Senate, hope for a government stimulus bill continues into next week. Two consumer confidence surveys were released this week, but with mixed indications. The University of Michigan survey showed a notable decline from the month prior, led by a lower “present situation” component. The Conference Board survey barely declined, as its “current conditions” component was only slightly lower. Markets will be closed next Friday, and the monthly jobs report will be released on January 8. To learn more about our financial planning subscription service, please call (937) 435-2742.

Ryan P. Johnson, CFA, CFP®
Director of Portfolio Management & Research

Commentary Disclosures


December 18, 2020

The S&P 500 declined about 1% this week as government stimulus talks continue to stall. Only a handful of companies (with off-cycle fiscal years) are expected to report earnings in the coming weeks. For fourth quarter results, most of which will be reported in January/February, sales and earnings are still expected to show year-over-year declines. 2021 is expected to show higher sales and earnings in each quarter compared to 2020. Inflation remains tame with core consumer inflation rising 1.6% year-over-year and core producer price inflation rising 1.4% year-over-year. Next week we look forward to the final Federal Reserve meeting of the year. Currently, the futures market is expecting the Fed Funds rate to stay near 0% through all of 2021. Lastly, we would like to highlight our recent quote in US News & World Report. To learn more about our financial planning subscription service, please call (937) 435-2742.

Ryan P. Johnson, CFA, CFP®
Director of Portfolio Management & Research

Commentary Disclosures


December 11, 2020

The S&P 500 declined about 1% this week as government stimulus talks continue to stall. Only a handful of companies (with off-cycle fiscal years) are expected to report earnings in the coming weeks. For fourth quarter results, most of which will be reported in January/February, sales and earnings are still expected to show year-over-year declines. 2021 is expected to show higher sales and earnings in each quarter compared to 2020. Inflation remains tame with core consumer inflation rising 1.6% year-over-year and core producer price inflation rising 1.4% year-over-year. Next week we look forward to the final Federal Reserve meeting of the year. Currently, the futures market is expecting the Fed Funds rate to stay near 0% through all of 2021. Lastly, we would like to highlight our recent quote in US News & World Report. To learn more about our financial planning subscription service, please call (937) 435-2742.

Ryan P. Johnson, CFA, CFP®
Director of Portfolio Management & Research

Commentary Disclosures


December 4, 2020

Once again the S&P 500 and other stock indices, like the small cap Russell 2000 and broad international benchmarks, made new closing highs today. The Dow closed over 30,000 on a weekly basis for the first time and a volatility index, the VIX, remains near its lowest levels since March, at just above 20. Stocks continue to focus on the promise of vaccines that could start to roll out in just a couple of weeks, though it will take many months for vaccines to become widely available. Longer-term Treasury yields continue to grind higher, with the 10-year yield just shy of 1%. In today’s monthly jobs report, the headline unemployment rate of 6.7% showed improvement, but the participation rate fell, meaning the gains were not very robust. Rising COVID-19 cases since mid-November (the reference week for the jobs survey ended 11/14) may lead to a weaker jobs report for the month of December. Next week we look forward to updates on inflation data. To learn more about our financial planning subscription service, please call (937) 435-2742.

Ryan P. Johnson, CFA, CFP®
Director of Portfolio Management & Research

Commentary Disclosures


November 20, 2020

On Monday, the S&P 500 started off by making a new daily closing high, but the index declined slightly for the week. The Dow Jones Industrial Average made an intraday high and closing high on Monday, nearly touching the 30,000 mark for the first time. The small cap Russell 2000 Index also made new highs this week. The market initially rallied on news from Moderna that their COVID-19 vaccine trail was successful with 94.5% effectiveness. Later in the week Pfizer/BioNTech updated their data showing 95% effectiveness. Today, both companies applied for emergency use authorization with the FDA. Both companies expect approval of their vaccines as soon as mid-December. Next week should be fairly quiet, with the markets closed on Thursday for Thanksgiving and open only until 1pm on Friday. Our next Market Recap will be posted the following week on December 4th. We thank you for your continued trust and support, and we hope you have a great Thanksgiving. To learn more about our financial planning subscription service, please call (937) 435-2742.

Ryan P. Johnson, CFA, CFP®
Director of Portfolio Management & Research

Commentary Disclosures


November 13, 2020

On Monday, Pfizer and partner BioNTech announced the successful results of their Phase 3 COVID-19 vaccine trial, which showed 90% effectiveness. This is wonderful news for humanity. We hope and expect that several other successful vaccines will be announced in the coming days and months. The initial stock market reaction was very positive, sending the S&P 500 to a new intraday high. The S&P 500 went on to make a closing high on a weekly basis and is up about 12% this year. The markets and the economy are not always the same thing; we expect some difficult months ahead with rising COVID-19 case counts and hospitalizations. The outlook for stocks seems to have already moved past politics and past the winter, with a focus on when we might start to enjoy a post-COVID-crisis world. Bond yields rose, with the 10-year Treasury moving as high as 0.97%, historically low but at the second-highest level seen since March. On November 17th we will have a very important webinar for business owners discussing Payroll Protection Program (PPP) loan forgiveness and the significant need for proper tax planning and treatment. If you or someone you know owns a business, please click on Events at the top of our website, www.mybuckingham.com, to register.

Ryan P. Johnson, CFA, CFP®
Director of Portfolio Management & Research

Commentary Disclosures


November 6, 2020

Stocks made gains nearly every day this week and the S&P 500 climbed over 7%, more than making up last week’s loss. Today the S&P 500 made a new weekly closing high, but remains about 2% below all-time highs set on September 2nd. The Technology sector outperformed and the Healthcare sector hit new highs as the Senate is expected to remain in Republican control, which will lead to fewer regulatory changes than were expected in a “blue wave” scenario. International stocks, gold, and even bond prices gained, but the dollar weakened this week. The strong monthly jobs report for October showed a 1% improvement in the unemployment rate, which now stands at 6.9%. The Federal Reserve announced no changes to interest rates, as expected, and their press release language was nearly unchanged from mid-September. To learn more about our financial planning subscription service, please call (937) 435-2742.

Ryan P. Johnson, CFA, CFP®
Director of Portfolio Management & Research

Commentary Disclosures


October 30, 2020

Stocks fell about 6% this week as additional fiscal stimulus was definitively put on hold and as coronavirus cases rose in the U.S. and abroad. Stock volatility rose to the highest since June, but bond yields and metals prices saw relatively small changes this week. Stock investors are concerned that additional shutdowns like the 4-week lockdown announced yesterday in France will lead to lower global economic activity. Third quarter earnings announcements are still rolling in, with about two-thirds of the S&P 500 having reported so far. While earnings are lower year-over-year, the reports are generally coming in above expectations. This week the first read on third quarter GDP was +33.1%. This was a quarter-over-quarter comparison stated at an annualized rate. Second quarter GDP, for reference, was -31.4%. Next week we expect volatility around the election, but we look forward to the monthly jobs report on Friday. To learn more about our financial planning subscription service, please call (937) 435-2742.

Ryan P. Johnson, CFA, CFP®
Director of Portfolio Management & Research

Commentary Disclosures


October 23, 2020

For the second week in a row, the bulk of the stock market’s movement for the week came on Monday. Unlike last week, this week the market declined as “significant disagreements” remained between Democrats and Republicans in fiscal stimulus talks. Stocks traded up or down several times this week on positive or negative headlines around these negotiations. It seems more and more likely that a fiscal stimulus bill will not be passed before the election and that these talks were just for posturing. Weekly jobless claims improved and continuing claims fell, again showing signs of a slowly improving jobs market. Next week we will get the first read on third quarter GDP, which should show a significantly positive number. This will be a quarter-over-quarter comparison stated at an annualized rate. Second quarter GDP, for reference, was -31%. To learn more about our financial planning subscription service, please call (937) 435-2742.

Ryan P. Johnson, CFA, CFP®
Director of Portfolio Management & Research

Commentary Disclosures