The Markets (as of market close December 31, 2021)

The last week of 2021 saw stocks close generally higher, with only the Nasdaq slipping lower. The Dow ended the week up 1.1%, followed by the S&P 500, the Global Dow, and the Russell 2000. The week between Christmas and New Year’s Day is generally marked by thin trading, and last week was no exception. Most of the market sectors closed the week in the black, led by real estate, utilities, materials, and consumer staples. Ten-year Treasury yields inched higher, crude oil prices rose $1.66 per barrel, while the dollar dipped lower.

Wall Street closed higher for a fourth day last Monday as investors weighed the prospects of a year-end rally against rising COVID cases. The S&P 500 gained 1.4% to mark its 69th record close of 2021. The Nasdaq also rose 1.4% as tech stocks continued to advance higher. The Dow rose 1.0%, the Russell 2000 climbed 0.9%, and the Global Dow added 0.6%. Ten-year Treasury yields slid, while crude oil prices and the dollar advanced. All of the market sectors moved higher, led by energy, real estate, and information technology.

Wednesday’s record close for the S&P 500 was the 70th of the year for that index.

Stocks closed the week and the year with mixed returns on Friday. The Dow, the S&P 500, and the Nasdaq, fell, while the Russell 2000 and the Global Dow inched higher. The market sectors were also mixed last Friday, with consumer staples, energy, industrials, materials, real estate, and utilities posting gains, while the remaining sectors slid. Ten-year Treasury yields, crude oil prices, and the dollar dipped lower.

Eye on the Week Ahead

There is plenty of important economic data available this week, beginning with the purchasing managers’ manufacturing survey. The manufacturing sector gained traction for much of 2021, only to be sidetracked somewhat by labor shortages and supply chain constrictions. The week ends with the December jobs report. Employment rose by 210,000 in November, well below the monthly average of 550,000.

Data sources: Economic: Based on data from U.S. Bureau of Labor Statistics (unemployment, inflation); U.S. Department of Commerce (GDP, corporate profits, retail sales, housing); S&P/Case-Shiller 20-City Composite Index (home prices); Institute for Supply Management (manufacturing/services). Performance: 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). 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. All information is based on sources deemed reliable, but no warranty or guarantee is made as to its accuracy or completeness. 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. Forecasts are based on current conditions, subject to change, and may not come to pass. U.S. Treasury securities are guaranteed by the federal government as to the timely payment of principal and interest. The principal value of Treasury securities and other bonds fluctuates with market conditions. Bonds are subject to inflation, interest-rate, and credit risks. As interest rates rise, bond prices typically fall. A bond sold or redeemed prior to maturity may be subject to loss. 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.

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 largest, publicly traded 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. The U.S. Dollar Index is a geometrically weighted index of the value of the U.S. dollar relative to six foreign currencies. Market indexes listed are unmanaged and are not available for direct investment.