US Equity Markets closed out 2019 on a strong note, with the S&P 500 finishing the year up 28.9% before dividends and up 31.5% after dividends. This marks the best returns for the S&P 500 since 2013. The Nasdaq finished the year up 35.2%, while the Russell 2000 (small-cap stocks) was up 23.7%. As for last week, the US airstrike in Iraq weighed on markets, causing the S&P 500 to drop 0.2% for the week. The Nasdaq continued to outperform, up 0.2% for the week, while the Russell 2000 fell 0.5%.
Global equity markets posted a strong 2019 as well, though not a strong as the US markets. Developed Markets rose 19.0% for 2019, while Emerging Markets increased 15.4% for the year. Last week, Developed Markets were flat, while Emerging Markets rallied 0.5% in part due to strength in oil markets following the US airstrikes.
US Interest Rates closed 2019 much lower than year-ago levels. The yield on the US 10-Year Treasury finished 2019 at 1.92% compared to 2.69% at the end of 2018. Last week, the US airstrikes caused an investor flight to safety, resulting in the yield on the US 10-Year Treasury dropping to 1.79%.
Of Interest to Us
Oil prices rose over 2.1% last week thanks to the US airstrikes in Iraq.While inflation has largely been tame, an oil price spike could change that quickly. In addition, Consumer Confidence for December came in below forecasts, though still remains at elevated levels. If Consumers short-term income prospects dip, then it is possible that the US economic momentum could slow in early 2020.
for the week ending 1/3/2020
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