A week that was shortened, as we paused to celebrate the life and legacy of Dr. Martin Luther King Jr., was still quite an eventful one. A Presidential Inauguration, the beginning of Q1 Earnings season, and some encouraging housing numbers kept the markets busy.
1.) Inauguration Day – Joe Biden officially became the 46th President of the United States, as he was sworn into office on Wednesday. History was also made, as Sen. Kamala Harris became the first female Vice President in U.S. history. President Biden wasted no time, signing several executive orders on Inauguration day. Some of those orders included revoking a permit for the Keystone XL oil pipeline, implementing a national mask mandate on Federal Property, and reversing a travel ban from several Muslim and African countries.
2.) Earnings Season Begins – Financial institutions were the first to report earnings from Q4 earlier this week, and results were mixed. Banks who focus on “Wall Street”, meaning those who generate a large amount of revenue from trading and investment banking, thrived. Goldman Sachs and Morgan Stanley both reported excellent numbers. However, banks who focus more on “Main Street”, meaning those who rely on consumer-lending, did not fare nearly as well. Banks such as Wells Fargo and Bank of America both saw increased deposits, but slower profit growth. As rates remain low, and corporations and individuals remain hesitant to take on additional debt, the “Wall Street” banks should continue to have greater success than many of the “Main Street” banks.
3.) Encouraging Housing Numbers –It was reported that new housing starts grew by 5.8% in December, the largest increase since 2006. New housing starts are an important economic indicator because it is a forward-looking metric that indicates optimism from home builders. Historically low mortgage rates and first-time Millennial homebuyers have more than offset concerns related to rising material costs. New housing starts are also important because new home supply is one of the best ways to keep home price appreciation from increasing too rapidly.
IMPORTANT DISCLOSURES
Investment advice offered through Strauss Financial Group, Inc., a Registered Investment Advisor.
These materials, opinions, analyses, and information are provided for general informational purposes only based upon sources believed to be reliable and in good faith—but are not considered all-inclusive, and no representation or warranty of any kind, expressed or implied, is made concerning accuracy, completeness, correctness, timeliness, or appropriateness. In addition, we undertake no obligation to update such opinions, analysis or information, and no warranty or guarantee is made. The information in these materials may change at any time and without notice. Neither the information nor any opinion expressed herein constitutes a solicitation for the purchase or sale of any securities and should not be relied on as financial advice. Please consult your attorney and/or accountant regarding legal and tax issues. Past performance is no guarantee of future results. All investing involves risk, including the potential loss of principal, and there can be no guarantee that any investing strategy will be successful.
Prices, quotes, rates, and yields are subject to change without notice. Not FDIC Insured, Not Bank Guaranteed, and May Lose Value.
Investment advice offered through Strauss Financial Group, Inc., a Registered Investment Advisor.
Data sources: News items are based on reports from multiple commonly available international news sources (i.e., wire services) and are independently verified when necessary with secondary sources such as government agencies, corporate press releases, or trade organizations. Market data: Based on data reported in WSJ Market Data Center (indexes); U.S. Treasury (Treasury yields); U.S. Energy Information Administration/Bloomberg.com Market Data (oil spot price, WTI Cushing, OK); www.goldprice.org (spot gold/silver); Oanda/FX Street (currency exchange rates).
The Dow Jones Industrial Average (DJIA) is a price-weighted index composed of 30 widely traded blue-chip U.S. common stocks. The S&P 500 is a market-cap weighted index composed of the common stocks of 500 leading companies in leading industries of the U.S. economy. The NASDAQ Composite Index is a market-value weighted index of all common stocks listed on the NASDAQ stock exchange. The Russell 2000 is a market-cap weighted index composed of 2,000 U.S. small-cap common stocks. The Global Dow is an equally weighted index of 150 widely traded blue-chip common stocks worldwide. Market indices listed are unmanaged and are not available for direct investment.