Most stock indexes trended higher last week, many to near all-time highs, as the US Labor Department reported payrolls increased by 943,000 last month. The increase exceeded economist expectations and drove the unemployment rate down to 5.4%[1]. In addition, average hourly wages also increased year-over-year, as many employers have increased pay in an effort to attract workers.
However, there are parts of the market that did not fare as well last week. Precious metals, such as gold and silver retreated last week as many believe the stronger employment data and recent upticks in inflation may force the US Federal Reserve to tighten its massive monetary stimulus sooner rather than later. Both crude oil and energy stocks retreated, as well, albeit for different reasons. The increase in coronavirus cases due to the delta strain appears to have investors in those markets concerned that the virus could reduce future demand[2].
Prices & Interest Rates
| Representative Index | Current | Year-End 2020 |
|---|---|---|
| Crude Oil (US WTI) | $65.43 | $48.52 |
| Gold | $1,742 | $1,893 |
| US Dollar | 92.78 | 89.94 |
| 2 Year Treasury | 0.21% | 0.13% |
| 10 Year Treasury | 1.31% | 0.93% |
| 30 Year Treasury | 1.94% | 1.65% |
| Source: Morningstar, YCharts, and US Treasury as of August 9, 2021 |
Asset Class Returns
| Category | Representative Index | YTD 2021 | Full Year 2020 |
|---|---|---|---|
| Global Equity | MSCI All-Country World | 14.2% | 16.3% |
| US Large Cap Equity | S&P 500 | 19.1% | 18.4% |
| US Large Cap Equity | Dow Jones Industrial Average | 16.2% | 9.7% |
| US Small Cap Equity | Russell 2000 | 14.4% | 20.0% |
| Foreign Developed Equity | MSCI EAFE | 10.8% | 7.8% |
| Emerging Market Equity | MSCI Emerging Markets | 1.4% | 18.3% |
| US Fixed Income | Bloomberg Barclays Municipal Bond | 1.8% | 5.2% |
| US Fixed Income | Bloomberg Barclays US Agg Bond | -0.9% | 7.5% |
| Global Fixed Income | Bloomberg Barclays Global Agg. Bond | -2.4% | 9.2% |
| Source: YCharts as of August 9, 2021 |
[1] US Payrolls July 2021 Climbed 943,000 Topping Estimates, Unemployment Rate 5.4% - Bloomberg
[2] Stock Market Today: Dow, S&P Live Updates for Aug 9 - Bloomberg
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Past performance may not be representative of future results. All investments are subject to loss. Forecasts regarding the market or economy are subject to a wide range of possible outcomes. The views presented in this market update may prove to be inaccurate for a variety of factors. These views are as of the date listed above and are subject to change based on changes in fundamental economic or market-related data. Please contact your Financial Advisor in order to complete an updated risk assessment to ensure that your investment allocation is appropriate.