MARKET COMMENTARY

Market Commentary 09-28-20

Weekly Market Commentary |
September 28, 2020

 

The Markets

For four weeks, the U.S. stock market has sparked and sputtered like a campfire in light rain.

Today, pandemic-driven demand is providing fuel for the investors. The need for certain types of products and services has accelerated and innovation is creating new opportunities. Consider:

       Technology. Today, digital technologies support nearly all group interactions, which has accelerated innovation. Traditional video communications platforms are in high demand, and multi-person virtual platforms are emerging. Robotics innovations are racing ahead, too. Robotic dogs enforce social distancing in Singaporean parks, reported Accenture. Other types of robots sanitize streets and facilitate contactless delivery around the globe.

 

       Consumer products and services. COVID-19 increased demand for staples, cleaning, and personal hygiene products. The virus may have inspired deeper and longer-lasting changes in consumer behavior, too. Accenture reported people are favoring healthier lifestyles, consuming goods more conscientiously, and showing a preference for locally-sourced goods.

       Healthcare, drug development/delivery, and medical equipment. Last Friday, 316 COVID-19 treatments and 212 vaccines were in development around the world, reported the Milliken Institute. In some places, humans are collaborating with artificial intelligence to streamline drug discovery processes. Demand for telehealth services has increased dramatically. So has demand for personal protective equipment, reported Pankaj Singh of Plastics Today.

Throughout 2020, investors• enthusiasm has pushed markets higher. However, concerns about a variety of issues have dampened enthusiasm in recent weeks. Last Friday, Ben Levisohn of Barron•s reported:

•In a week filled with headlines about government stimulus (or the lack thereof), Supreme Court nominations, the election, the gain in the Nasdaq•suggests that it was the fear of another COVID-19 wave that really got the market down. And for good reason. The week began with the U.K. talking about a second shutdown and ended with all of Europe facing down a second wave of infection•In the U.S., the number of cases is rising and the death toll passed 200,000 midweek••

Many of these concerns aren•t likely to dissipate soon, and volatility is likely to continue.

Last week, the Standard & Poor•s 500 Index and Dow Jones Industrial Average lost value, while the Nasdaq Composite gained value.

 


Data as of 9/25/20

1-Week

Y-T-D

1-Year

3-Year

5-Year

10-Year

Standard & Poor's 500 (Domestic Stocks)

-0.6%

2.1%

10.5%

9.7%

11.8%

11.2%

Dow Jones Global ex-U.S.

-4.2

-7.9

-0.2

-1.5

3.5

1.7

10-year Treasury Note (Yield Only)

0.7

NA

1.7

2.2

2.2

2.5

Gold (per ounce)

-4.7

22.1

21.5

12.9

10.2

3.7

Bloomberg Commodity Index

-3.2

-12.6

-10.4

-6.1

-4.4

-6.6

S&P 500, Dow Jones Global ex-US, Gold, Bloomberg Commodity Index returns exclude reinvested dividends (gold does not pay a dividend) and the three-, five-, and 10-year returns are annualized; and the 10-year Treasury Note is simply the yield at the close of the day on each of the historical time periods.

Sources: Yahoo! Finance, MarketWatch, djindexes.com, London Bullion Market Association.

Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly. N/A means not applicable.