Portfolio Advisory Council, LLC presents:
 

 

THE WEEKLY ECONOMIC UPDATE

 

December 7, 2020 


QUOTE OF THE WEEK 

"The American People in their Righteous Might will win through to Absolute Victory."

FRANKLIN D. ROOSEVELT

 
THE WEEK ON WALL STREET

Stocks marched higher last week on an improving outlook for the passage of a fiscal stimulus package.

The Dow Jones Industrial Average rose 1.03%, while the Standard & Poor's 500 tacked on 1.67%. The Nasdaq Composite index gained 2.12% for the week. The MSCI EAFE index, which tracks developed overseas stock markets, gained 0.78%.1,2,3

A Record Week for Stocks

After opening the week with moderate losses amid rising COVID-19 infections, stocks turned higher as investor sentiment was buoyed by the resumption of fiscal stimulus negotiations. As lawmakers discussed various proposals, stocks managed to grind higher.

A better-than-expected jobless claims report on Thursday added fuel to the market rally, but the gains evaporated in late-day trading following news by a major pharmaceutical company that it would be slowing its rollout of the vaccine due to logistical challenges.4

A disappointing jobs report on Friday did not keep investors from bidding stocks higher as the week came to a close, sending the Dow Jones Industrials, S&P 500, and the NASDAQ Composite indices to record high closes.5

The Start of Holiday Shopping

The start of the holiday shopping season provides important insight into the state of the economy and overall consumer confidence. In response to the pandemic, consumers avoided in-store visits over the Thanksgiving weekend. This translated into a 22.4% decline in spending from last year's levels.6

However, spending prior to the Thanksgiving-to-Sunday period surged 65.7% from a year earlier, thanks to large retailers introducing Black Friday-like deals as early as mid-October.6

Of course, the pandemic has led to an acceleration in shopping online. Cyber Monday sales jumped 15.1% over last year's levels as consumers spent almost $11 billion, making it the largest U.S. online shopping day ever.7
 
 

BY THE NUMBER$

SUPPLY AND DEMAND - On 4/09/20, OPEC and Russia agreed to a historic production cut of 10 million barrels a day. The price of West Texas Intermediate (WTI) crude oil had fallen to $22.76 a barrel as of 4/09/20 as the global impact of COVID-19 was crushing the worldwide demand for oil. As of last Friday 12/04/20, WTI crude oil closed at $46.26 a barrel (source: NYMEX).

THE FRIENDLIER SKIES - 4,592,989 passengers went through TSA screening at US airports on the Wednesday before Thanksgiving through the Sunday after Thanksgiving, i.e., 11/25/20 through and including 11/29/20. Exactly 8 months earlier, i.e., Wednesday 3/25/20 through Sunday 3/29/20, just 1,006,765 passengers went through TSA screening at US airports (source: TSA). 8
 

THE WEEK AHEAD: KEY ECONOMIC DATA

Wednesday: Gross Domestic Product (GDP), Job Openings and Labor Turnover Survey (JOLTS).

Thursday: Consumer Price Index (CPI), Jobless Claims.

Friday: Consumer Sentiment.

Source: Econoday, December 4, 2020

The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.
 

THE WEEK AHEAD: COMPANIES REPORTING EARNINGS

Monday: Coupa Software (COUP).

Tuesday: Autozone (AZO), Mongodb, Inc. (MDB), Chewy, Inc. (CHWY).

Wednesday: Campbell Soup Company (CPB), Slack Technologies (WORK).

Thursday: Lululemon Athletica, Inc. (LULU), Adobe, Inc. (ADBE), Broadcom (AVGO), Costco 
Wholesale Corp. (COST).

Source: Zacks, December 4, 2020

Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.
 
 
 
 
THE WEEKLY RIDDLE
 
I have keys that will open no locks. I have a space and a lock that's a key. You can enter but you can't leave, and yet - you can escape. What am I?
 

LAST WEEK'S RIDDLE: You heard me before, yet you hear me once more. Then I die 'til you call me again. What am I?
ANSWER: An echo.
 



Portfolio Advisory Council, LLC
A Registered Investment Advisory Since 1986
             
Investment advisory services offered through Portfolio Advisory Council, LLC, and an SEC Registered Investment Adviser.
 
We cannot accept trade orders through e-mail. Important letters, e-mail, or fax messages should be confirmed by calling 713.574.6015.  This email service may not be monitored every day, or after normal business hours.  

James W. Hamilton, CFS, AIF
713.574.6025
 
W. Thomas Sutton  CFP(R), ChFC, CLU
713.574.6020
 
Philip B. Moran, MBA, ChFC, CFP(R), AIF
713.574.6030
 
John C. Husbands

Visit us at www.pac1000.com 



This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. The information herein has been derived from sources believed to be accurate. Please note - investing involves risk, and past performance is no guarantee of future results. Investments will fluctuate and when redeemed may be worth more or less than when originally invested. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All market indices discussed are unmanaged and are not illustrative of any particular investment. Indices do not incur management fees, costs and expenses, and cannot be invested into directly. All economic and performance data is historical and not indicative of future results. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is a market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Standard & Poor's 500 (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. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New York Stock Exchange (the "NYSE") and NYSE Arca (formerly known as the Archipelago Exchange, or ArcaEx®, and the Pacific Exchange). NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. (NYMEX) is the world's largest physical commodity futures exchange and the preeminent trading forum for energy and precious metals, with trading conducted through two divisions - the NYMEX Division, home to the energy, platinum, and palladium markets, and the COMEX Division, on which all other metals trade. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards. This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. MarketingPro, Inc. is not affiliated with any person or firm that may be providing this information to you. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional.


CITATIONS:
1. The Wall Street Journal, December 4, 2020
2. The Wall Street Journal, December 4, 2020
3. The Wall Street Journal, December 4, 2020
4. The Wall Street Journal, December 3, 2020
5. CNBC, December 4, 2020
6. CNBC, November 30, 2020
7. CNBC, December 1, 2020
8. Reproduction Prohibited without Express Permission - Copyright © 2011 Michael A. Higley