Market Moment
Glen Eagle®: America’s Women-Owned Trading Desk®
02/22/2021
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Interest Rates vs The Market: With the US economic recovery continuing to look strong, some worry that the Fed could raise rates faster than expected which could restrain the stock market. However, this risk does not seem imminent as the Fed has made it clear that they will allow periods of higher inflation in the future. Additionally, despite conventional thinking, rising rates do not always signal a pullback in equities. In 13 or the 16 postwar periods in which interest rates rose, the stock market also rose with an annualized total return of 13%
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The Tide Has Turned: Many of the “pandemic-plays” like Zoom, Netflix, and Amazon have underperformed the stock market since October when investors became hopeful for a broader economic reopening. Simultaneously, many of the hardest hit companies during the pandemic such as Live Nation Entertainment and Simon Property Group are up over 70% over the same period. Despite these types of recoveries, many airlines, movie-theater, and retailers remain below their pre-pandemic levels.
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The Pound Looks Strong: The British Pound has risen to its highest level against the US dollar in close to three years. The move is the result of both the reduction of uncertainty around the nation now that the Brexit deal has passed and the quick pace of vaccination. Britain is on track to become the first major economy to vaccinate its entire adult population and only trails Israel and the United Arab Emirates in the number of vaccination doses given per 100 people. Data shows that hedge funds expect the pound to continue rising against the dollar, which may weaken further from additional fiscal spending.
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Endowments Struggle: University Endowments struggled in 2020 as they were forced to spend more money to make up for lost revenue in the new “remote learning environment.” More than 40% of universities lost revenue and 70% increased the amount they spent from their endowment. While all endowments struggled in terms of investment returns through the fiscal year (ending June 30th, the larger endowments (with more than $1 billion in assets) were able to perform slightly better with a 2.5% average return (versus 1.8% average for all endowments).
Economic Calendar
Monday: Leading economic indicators (Jan)
Tuesday: Home price index (Dec), Consumer confidence index (Feb), FedChair Powell testifies
Wednesday: New home sales (Jan), Fed Chair Powell testifies
Thursday: GDP (Q4), Durable goods - Jan, Cap goods (Jan)
Friday: Personal income (Jan), Consumer spending (Jan), Core inflation (Jan), Consumer sentiment index (Feb)
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US Futures
S&P 3874.5 -0.73%
DOW 31,262 -0.54%
NASDAQ 13,405.25 -1.26%
World Markets
FTSE 65811.47 -0.64%
NIKKEI 30,156.03 +0.46%
Hang Seng 30,319.8
+1.06%
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Treasuries
3 Mo 0.03%
10YR 1.34%
30 YR 2.14%
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Currencies
Euro $1.214
Pound $1.403
Yen $105.55
Commodities
Gold 1796.1 +1.05%
WTI Crude 59.69 +0.76%
Silver 27.57
+1.16%
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Upcoming Earnings Calls
Monday - DISH, RCL, DISC, PANW, OXY
Tuesday - HD, M, INTU, SQ
Wednesday - VIAC, LOW, TJX, NVDA, APA, TDOC, BKNG
Thursday - ABNB, PCG, DPZ, W, BBY, MRNA, NCLH, DASH, NKLA, CRM, CRW, ETSY, LYV, WDAY
Friday - DKNG, CNK
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Consider working with Glen Eagle as one of your preferred partner trading desks
Client Focused Trading for large institutions, pensions, hedge funds, wealthy families, and private equity for over 30 years
Ansie Monaghan
Carol Ann Fernandez
Glen Eagle
4422C Route 27
PO Box 399
Kingston, NJ 08528
(609) 631-8231
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