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 February 25, 2022.

Economic/Market happenings:

Stocks

  • The S&P 500 (ticker IVV) entered correction territory Tuesday afternoon, sinking after Russia launched a full-scale invasion of Ukraine. The broad stock index had declined more than 10% from its most recent high on January 3rd. (8) This reflected concern and uncertainly over the sanctions that the U.S. and other nations would impose on Russia as the sanctions are likely to result in added inflation. The markets regained some strength later in the week. The S&P ended the week up 0.84% while the NASDAQ gained 1.10% and the Russell 2000 added 1.59%. Overseas, the developed markets (MSCI EAFE) lost 2.49% while emerging markets (MSCI EM) dropped 4.84%. (1)

Fixed Income

  • Interest rates rose and the yield curve flattened, with 2-year treasury yields rising 8 basis points to 1.55%, the 10-year Treasuries rising 5 basis points to end the week at 1.97%, and the 30-years rising 5 basis points to 2.29%. US Treasuries have seen an influx of international buyers up to and since the Russian invasion since securities backed by the US government are viewed as safe havens. (2)

Commodities

  • Oil prices have increased 0.6% and 21.6% over the last week and year to date, respectively. (1) The price of West Texas crude ended the week at $91.59 per barrel, driven by concerns surrounding Russia’s invasion of Ukraine and its repercussions on global supplies. (3)

  • Palladium (PALL), a Precious Metals strategy holding, reached a 7-month high of $2,533 per troy ounce.4 The ETF has risen 28.0% since our purchase in early January on concerns surrounding available supplies since Russia is a major producer. (8) This precious metal is used in catalytic converters for vehicles along with electrical contacts and medical instruments.

​Economic Data

  • The 20-city index of home prices rose 18.6% year over year in December, ahead of the consensus estimate of 18.0%. Phoenix, Tampa, and Miami saw the largest year-over-year gains, over 27% each. (5)

  • Orders for durable goods rose 1.6% in January, twice the rate of the consensus estimate. Durable goods orders are a leading indicator of industrial production and capital spending. This marks an acceleration from the sharply upward revision to December orders which had a 1.2% increase.6

  • Consumer spending rebounded in January after falling for the first time in ten months. It increased 2.1% as the Covid omicron variant faded and Americans bought more new cars and recreational items. This was well ahead of expectations for a 1.6% gain. (7)

Proprietary portfolio happenings:

Company News (8)

  • MercadoLibre Inc. (MELI), a G33 holding, shares rose 18.58% after the online retailer reported revenue and operating profits that far exceeded consensus expectations. (9)

  • Palo Alto Networks Inc. (PANW), a Core Select and G33 holding, shares rose 18.2% last week on added concerns for internet security following the Russian invasion and threats to web-based systems. (10)

  • Sprout Social Inc. (SPT), a G33 holding, reported revenue and earnings that exceeded consensus expectations and also guided results higher for the coming year. This global designer and developer of social media applications continues to add larger customers to their base, driving profit margins higher. Shares rose 22.1% last week. (11)

 

Did You Know? You could fit 109 Earths side-by-side to match the diameter of the Sun. To fill it up, it would take 1.3 million planets the size of the Earth.


Sources:

(1) JP Morgan Weekly Market Recap 2-28-22

(2) US Treasury

(3) oilprice.com

(4) Apmex

(5) S&P CoreLogic Case-Shiller 2-22-22

(6) Census Bureau 2-25-22

(7) Bureau of Economic Analysis 2-25-22

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

(9) MercadoLibre press release 2-22-22

(10) Palo Alto Networks 2-22-22

(11) Sprout Social Inc. press release 2-22-22

Herstle Jones, LUTCF, CLTC President & Founder

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

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