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Canadian stocks finished mixed, while U.S. stocks closed at a six-week low, driven by weakness in technology stocks, which exert an outsized influence on major indexes because of their size. Even though more than 70% of the S&P 500 stocks were higher, the index closed lower for the third week in a row. On the flip side, cyclical, small-cap and international stocks, and oil, all rebounded, finishing positive for the week. The Federal Reserve signaled that it will keep rates near zero through at least 2023 to help the economy weather the health and economic crisis. Canadian retail sales showed that the economic recovery is progressing, but the pace of improvement is slowing. In this environment, we believe, as last week demonstrated, that well-diversified portfolios can be better prepared to weather volatility.
Fall officially ousts summer this week, ushering in traditional seasonal changes (back to school, weather, holidays, etc.) that may pose particular implications for economic conditions over the remainder of the year given the unique environment. Fresh economic readings, politics and the latest U.S. Fed meeting were all on stage last week, highlighting three key market matchups that will shape the investment landscape as we advance through 2020.
1. The Tech Selloff vs. the Bull Market:
2. COVID-19 vs. Consumers:
3. The Election vs. Fundamentals:
Craig Fehr, CFA
Source: 1. Bloomberg
|S&P 500 Index||3,319||-0.6%||2.7%|
|10-yr GoC Yield||
There are no major economic releases in Canada. Economic data being released in the U.S. include existing home sales on Tuesday, the September preliminary Purchasing Managers' Index on Wednesday, and durable goods orders on Friday.
The Weekly Market Update is published every Friday, after market close.
Edward Jones does not provide access to past weekly summaries.
Market indexes are unmanaged and cannot be invested into directly and are not meant to depict an actual investment.
Past performance does not guarantee future results.
Diversification does not guarantee a profit or protect against loss.
Systematic investing does not guarantee a profit or protect against loss. Investors should consider their willingness to keep investing when share prices are declining.
Dividends may be increased, decreased or eliminated at any time without notice.
Investors should understand the risks involved of owning investments, including interest rate risk, credit risk and market risk. The value of investments fluctuates and investors can lose some or all of their principal.
Special risks are inherent to international investing, including those related to currency fluctuations and foreign political and economic events.
The content of this report is for informational purposes only and should not be interpreted as specific investment advice. Investors should make investment decisions based on their unique investment objectives and financial situation. While the information is believed to be accurate, it is not guaranteed and is subject to change without notice.
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