The Bottom Line
● U.S. equities advanced for the third week in a row and sixth in the last seven. Major U.S. indices closed at record highs, overcoming a big drop on Thursday over fears of the spreading Delta variant and slowing global growth.
● Despite a +7 basis point rally on Friday, the yield on the 10‐year U.S. Treasury dropped ‐6basis points forthe week, closing at 1.36%. At its lowest point on Thursday the 10‐year was down near 1.25%.
● The Labor Department reported that May job openings rose by +16,000, pushing the total to a new record high of 9.2 million jobs, which nearly matches the 9.3 million unemployed Americans that are actively seeking jobs.
In what seems to have become a regular occurrence in 2021, major U.S. indices set fresh all‐time highs on Friday, capping an otherwise wobbly week. It took a big rally on Friday to overcome Thursday’s losses over fears of the Delta COVID variant spreading and worries that global growth was peaking. It was the third straight weekly gain for the S&P 500 and the sixth week of gains in the last seven. The Dow Jones Industrial Average and Nasdaq Composite also finished at record highs. Though small caps fell short of record highs, falling ‐1.1% for the week, the Russell 2000 did rebound+2.0% on Friday. The Friday stock rally was spurred by news that Pfizer is working on a booster shot to combat the Delta variant and China’s central bank was boosting liquidity by reducing the amount of cash its banks must hold in reserve. The yield on 10‐year U.S. Treasury has fallen for two consecutive weeks, and fell as low as 1.25% on Thursday, but reversed noticeably on Friday. The 10‐year Treasury yield rose 7 basis points Friday to close at 1.36%. Economic news was relatively quiet during the week and markets appeared to shrug an executive order by President Joe Biden’s to crack down on anticompetitive practices among U.S. businesses.
Digits & Did You Knows
CANCER — The diagnoses of some forms of cancer fell by more than ‐50% in 2020 when compared to 2019, not because cancer is on the decline but because 94% of Americans postponed their annual screenings and many cancer clinics suspended the collection of biopsies (source: Propublica, BTN Research).
REAL ESTATE — In March 2020 1.49 million existing homes were on the market for sale. By March 2021, just 1.05 million homes were on the market. With a smaller supply, home prices soared. The median sales price of existing homes sold rose from $280,700 in March 2020 to $350,300 in May 2021, a +25% increase (source: Nat’l Association of Realtors, BTN).
Source: Bloomberg. Asset‐class performance is presented by using market returns from an exchange‐traded fund (ETF) proxy that best represents its respective broad asset class. Returns shown are net of fund fees for and do not necessarily represent performance of specific mutual funds and/or exchange‐traded funds recommended by the Prime Capital Investment Advisors. The performance of those funds may be substantially different than the performance of the broad asset classes and to proxy ETFs represented here. U.S. Bonds (iShares Core U.S. Aggregate Bond ETF); High‐YieldBond(iShares iBoxx $ High Yield Corporate Bond ETF); Intl Bonds (SPDR® Bloomberg Barclays International Corporate Bond ETF); Large Growth (iShares Russell 1000 Growth ETF); Large Value (iShares Russell 1000 ValueETF);MidGrowth(iSharesRussell Mid‐CapGrowthETF);MidValue (iSharesRussell Mid‐Cap Value ETF); Small Growth (iShares Russell 2000 Growth ETF); Small Value (iShares Russell 2000 Value ETF); Intl Equity (iShares MSCI EAFE ETF); Emg Markets (iShares MSCI Emerging Markets ETF); and Real Estate (iShares U.S. Real Estate ETF). The return displayed as “Allocation” is a weighted average of the ETF proxies shown as represented by: 30% U.S. Bonds, 5% International Bonds, 5% High Yield Bonds, 10% Large Growth, 10% Large Value, 4% Mid Growth, 4%Mid Value, 2% Small Growth, 2% Small Value, 18% International Stock, 7% Emerging Markets, 3% Real Estate.
Advisory services offered through Prime Capital Investment Advisors, LLC. (“PCIA”), a Registered Investment Adviser. PCIA doing business as Prime Capital Wealth Management (“PCWM”) and Qualified Plan Advisors (“QPA”).
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