Risk assets continued their upward trajectory last week, with nearly every major equity index posting positive returns through Friday. The S&P 500 (a proxy for large-cap US stocks) was up 1.7% for the week and the MSCI ACWI index (a proxy for global large-cap stocks) climbed 1.3%[1]. Both indexes are up double-digits so far this year and they each finished the week very near all-time highs (see below).
US investors should have technology on their minds this week, as the five largest tech companies in the country are set to release earnings. Facebook, Alphabet, Microsoft, Apple, and Amazon all will report third quarter results this week[2]. Positive results may help justify high valuations in investors’ minds, while disappointing results may serve to exacerbate concerns about inflation and supply chain snags.
In other news, not one, but two Bitcoin ETFs launched last week, as Wall Street seeks to capitalize on the interest in the cryptocurrency by launching related investment vehicles. ProShares launched the first exchange traded fund (ETF) early in the week, and Valkyrie followed up with their ETF offering on Friday[3].
Prices & Interest Rates
| Representative Index | Current | Year-End 2020 |
|---|---|---|
| Crude Oil (US WTI) | $84.30 | $48.52 |
| Gold | $1,801 | $1,893 |
| US Dollar | 93.61 | 89.94 |
| 2 Year Treasury | 0.48% | 0.13% |
| 10 Year Treasury | 1.66% | 0.93% |
| 30 Year Treasury | 2.08% | 1.65% |
| Source: Morningstar, YCharts, and US Treasury as of October 25, 2021 |
Asset Class Returns
| Category | Representative Index | YTD 2021 | Full Year 2020 |
|---|---|---|---|
| Global Equity | MSCI All-Country World | 16.3% | 16.3% |
| Global Equity | MSCI All-Country World ESG Leaders | 18.0% | 16.0% |
| US Large Cap Equity | S&P 500 | 22.4% | 18.4% |
| US Large Cap Equity | Dow Jones Industrial Average | 18.3% | 9.7% |
| US Small Cap Equity | Russell 2000 | 16.9% | 20.0% |
| Foreign Developed Equity | MSCI EAFE | 11.1% | 7.8% |
| Emerging Market Equity | MSCI Emerging Markets | 2.0% | 18.3% |
| US Fixed Income | Bloomberg Barclays Municipal Bond | 0.4% | 5.2% |
| US Fixed Income | Bloomberg Barclays US Agg Bond | -2.1% | 7.5% |
| Global Fixed Income | Bloomberg Barclays Global Agg. Bond | -4.3% | 9.2% |
| Source: YCharts as of October 25, 2021 | |||
[1] Source: YCharts
[2] Source: Faith That Tech Stocks Offer the Most Reliable Profit Growth Will be Tested - Bloomberg
[3] Source: Second U.S. Bitcoin ETF Launches in Wake of Record-Setting Debut - 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.