Hello and welcome to this week’s Jones Financial Blog! Our goal at Jones & Associates is to help keep you up to date with interesting current economic/market happenings as well as some proprietary portfolio happenings. Knowledge is power and thought we would share some of ours with you. Enjoy!
All data is for the week ended July 2, 2021.
Stock markets were mixed as the second quarter of 2021 ended. The S&P 500 was up 1.71% for the week while US small cap stocks (Russell 2000) were down 1.18%. International markets were largely down for the week, with international developed (MSCI EAFE) down 1.09% and emerging markets (MSCI EM) down 1.63%. (1)
The US aggregate bond index was up 0.54%1 for the week as interest rates continued to decline. The 10-year US Treasury rate, after cresting at 1.74% in March, has now fallen to 1.44% at the end of June. This is despite economic data that continues to show both economic growth and rising inflation. (2)
Crude oil prices, based on WTI crude, closed at $75.16 (9) per barrel after the government’s report of a 6.7 million barrel decline in inventories, far more than the consensus estimate of a 4.7 million barrel drop. (3)
Growth in employment for June of 850,000 was toward the higher end of the consensus expected range, and the rise in the labor force – as people returned to seeking jobs—caused the unemployment rate to rise to 5.9%. Leisure and hospitality showed the largest gain in new jobs. Average hourly pay rose 3.6% year over year, the highest rate since 1983. (4)
April Case-Shiller 20-city home price was up 14.6% annually in April, rising from 12.9% in the previous month. All 20 cities listed reported higher price increases in April, with Phoenix, San Diego, and Seattle reporting the highest year over year price growth. (5)
Proprietary portfolio happenings:
Company News (6)
Goldman Sachs (GS), a Core Select Holding, raised their dividend to $2.00 from $1.25 per share after releasing results of their Federal Reserve stress test. Shares were up 1.46% for the week. (7)
Facebook (FB), a G33 and Core Select holding, cleared $1 Trillion in market capitalization last week after a Federal court dismissed the Federal Trade Commission (FTC) antitrust claim against the company.8 The stock was up 3.90% for the week. (9)
Did You Know? The average age of cars and light trucks operating in the US has risen to 12.1 years in 2021 as Covid and its impact caused a drastic reduction in new vehicle sales as well as fewer miles driven over the last year A sudden increase in vehicle scrappage also raised the average age. The ongoing shortage in microchips is expected to continue to lengthen the average vehicle age.
(6) All weekly changes in company stock prices: Stockcharts.com
(8) Cnn.com 6-28-21