Market/Portfolio Happenings





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 30, 2021

Economic/Market happenings:

Stocks

  • The equities markets were mixed last week, with the benchmark S&P 500 down 0.35%, the Russell 2000 up 0.76% and the NASDAQ down 1.10%. Overseas, the international developed markets (MSCI EAFE) rose 0.62% while the emerging markets dropped 2.48%. Within the US, materials and energy were the best performing sectors while consumer discretionary and communications services were the laggards. By style, small cap value was the best performing while large cap growth was the laggard. (1)

Fixed Income

  • Interest rates declined and bond values rose last week. The rate on 10-year Treasuries declined 6 basis points to 1.24% and the yield curve was virtually unchanged. The 30-year fixed mortgage was unchanged at 3.01%. (1)

Commodities

  • Oil prices rose last week, with West Texas crude ending at $73.95 per barrel, up 2.61%. (2) The increase was attributable to demand growth at a faster pace than supply growth and expectations that vaccinations will stem the impact of Covid from this point forward. (3)

​Economic Data

  • The US economy grew at a 6.5% annual rate in the spring quarter, well below consensus expectations for 8.5% growth but still the best rate in two decades. The shortfall was due to four factors: lower inventories, reduced exports, real estate broker commissions and home improvement (likely due to higher materials prices). (4)

  • The Eurozone economy grew at a faster than expected rate in the second quarter, rising 2.0% vs. the 1.5% consensus expectation. On a year over year basis, it increased 13.7% as the region rebounded with the end of Covid lockdowns. (5)

  • Durable goods orders increased in June despite ongoing shortages in parts and labor. New orders rose 0.8% from May which was below the consensus estimate of 2.0%. However, the May report was raised to 3.2% from 2.3%. Ex-transportation, orders rose 0.3% in June, below the consensus expectation of 0.9% growth. (6)

  • U.S. home prices set another record in May, as the national index rose 16.6% over the past year for the 12th consecutive month of gains, up from the prior record of 14.8% set last month.Among the major cities,Phoenix led the way with a 25.9% year-over-year price increase, followed by San Diego with a 24.7% gain. (7)

Proprietary portfolio happenings:

Company News (8)

  • Amazon.com Inc. (AMZN), a G33, Contrarian Choice and Core Select holding, fell 9.00% last week following a disappointing earnings report and after the new CEO lowered revenue guidance for the current quarter. (9)

  • DexCom, Inc. (DXCM), a G33 and Core Select holding, rose 11.89% after quarterly results beat expectations and managers indicated that they are taking market share and will launch a new diabetes management system later this year. (10)

  • Paypal Holdings, Inc. (PYPL), a G33 and Core Select holding, dropped 10.70% after management reported that revenues fell short of expectations and issued disappointing guidance for the current quarter. (11)

Did You Know? The Christmas classic movie, “Miracle on 34th Street”, was a summer release in 1947. The timing was because the greatest number of people visited movie theaters during the warmest months of the year. This was due to the fact that theaters had air conditioning and most homes did not.



Sources:

(1) JP Morgan Weekly Market Recap 8-2-21

(2) Oilprice.com

(3) Reuters, “Oil Climbs, Notches Fourth Monthly Gain” 7-30-21

(4) Bureau of Economic Analysis 7-29-21

(5) Eurostat 7-30-21

(6) US Commerce Department 7-27-21

(7) S&P CoreLogic Case-Shiller Index 7-27-21

(8) All weekly changes in company stock prices: Yahoo Finance

(9) Amazon.com press release 7-29-21

(10) DexCom presentation 7-29-21

(11) PayPal Holdings press release 7-28-21



Herstle Jones, LUTCF, CLTC President & Founder

With over 20 years of experience in the financial services industry,

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