Market Update: Tues, Dec 1 2020 | LPL Financial Research

Market Update: Tues, Dec 1 2020 | LPL Financial Research

December 02, 2020
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COVID-19 May Threaten the Recovery

The stock market doesn’t appear fazed by the recent increase in COVID-19 outbreaks, but underlying economic data is beginning to reflect the latest government and consumer shutdowns. LPL Research’s Weekly Market Commentary explains potential economic effects of another lockdown.

Read Weekly Market Commentary

Daily Insights

Stocks off to a strong start in December. The S&P 500 Index is following global stocks higher at open as we enter the final month of the year.

  • Positive Asian manufacturing data helped spur international stocks overnight.
  • China, Japan, and South Korea were all up over 1%.
  • Europe is showing solid gains at midday.

Credit spreads have moved below historical averages.

  • Both investment-grade and high-yield corporate bond credit spreads have moved below historical averages, as measured by Bloomberg Barclays indexes.
  • Credit spreads have tightened quickly from their widest levels, reaching a level in months that took years after the 2008–09 recession.
  • We believe the current level still represents something close to fair value for early cycle, although there are risks from economic uncertainty around the latest COVID-19 surge.

November was a record-breaking month. Thanks to gridlock in Washington and positive vaccine news, November was a record-breaking month for stocks.

  • Best month for Dow since January 1987 (11.9%) and best November since 1928
  • Best month ever for the STOXX 600 (16.7%)
  • Best month ever for the Russell 2000 (18.3%)
  • Best month for the S&P 500 (10.8%) and Nasdaq (11.8%) since April 2020
  • Best month for Dow Transports since October 2011 (12.1%)
  • Best month from PHLX Semiconductor Index since March 2003 (18.4%)
  • Best month for Industrials (16.0%) and Financials (16.8%) since April 2009
  • Second best month ever for energy (28.0%)

 

IMPORTANT DISCLOSURES

This material is for general information only and is not intended to provide specific advice or recommendations for any individual. There is no assurance that the views or strategies discussed are suitable for all investors or will yield positive outcomes. Investing involves risks including possible loss of principal. Any economic forecasts set forth may not develop as predicted and are subject to change.

References to markets, asset classes, and sectors are generally regarding the corresponding market index. Indexes are unmanaged statistical composites and cannot be invested into directly. Index performance is not indicative of the performance of any investment and do not reflect fees, expenses, or sales charges. All performance referenced is historical and is no guarantee of future results.

Any company names noted herein are for educational purposes only and not an indication of trading intent or a solicitation of their products or services. LPL Financial doesn’t provide research on individual equities.

All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.

All index and market data are from FactSet and MarketWatch.

This Research material was prepared by LPL Financial, LLC.

Securities and advisory services offered through LPL Financial (LPL), a registered investment advisor and broker-dealer (member FINRA/SIPC).

Insurance products are offered through LPL or its licensed affiliates.  To the extent you are receiving investment advice from a separately registered independent investment advisor that is not an LPL affiliate, please note LPL makes no representation with respect to such entity.

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  • Not Bank/Credit Union Guaranteed
  • Not Bank/Credit Union Deposits or Obligations
  • May Lose Value

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