By: Sean Schmid, Chief Operating Officer – Penn Investment Advisors
Weekly Update – November 23, 2020
The Week on Wall Street
Despite news of another COVID-19 vaccine candidate, stocks were mixed amid investor anxiety over an increase in new infections and economic lockdowns.
The Dow Jones Industrial Average fell 0.73%, while the Standard & Poor’s 500 declined 0.77%. The Nasdaq Composite index rose 0.22% for the week. The MSCI EAFE index, which tracks developed overseas stock markets, gained 1.42%.[1],[2],[3]
Groundhog Week
The announcement of another potential COVID-19 vaccine ignited strong gains to begin the week. But, like the week that preceded it, the gains sparked by the vaccine news were eroded in the following days as worries over the economic impact of new infections moved to the fore.
The market has been grappling with conflicting narratives. One is the optimistic view that, with COVID-19 vaccines apparently near at-hand, the return to economic normalcy grows ever closer. That hopeful outlook has been offset by anxiety over new infections, rising hospitalizations, and some local and state lockdowns.
These crosscurrents kept stocks range bound for the week, with the technology sector and small and mid-size stocks lending support to the overall market.
Powell Sounds a Warning
In a speech last week, Federal Reserve Chairman Jerome Powell warned that the nationwide increase in COVID-19 cases could hamper economic activity in the upcoming months. He expressed concern that consumer spending may trend lower despite efforts to control the spread of infections.[4]
Powell once again voiced his support for additional fiscal stimulus to assist small businesses, state and local governments, and the unemployed. He also said that even after full economic recovery, some businesses and workers may wrestle with an economic landscape altered by the coronavirus.
THE WEEK AHEAD –
KEY ECONOMIC DATA:
Tuesday: Consumer Confidence.
Wednesday: Durable Goods Orders, Gross Domestic Product (GDP), Jobless Claims, Consumer Sentiment, New Home Sales.
Source: Econoday, November 20, 2020. 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 release of data may be delayed without notice for a variety of reasons, including the shutdown of the government agency or change at the private institution that handles the material
THE WEEK AHEAD –
COMPANIES REPORTING EARNINGS:
Tuesday: Best Buy (BBY), Medtronic (MDT), Dollar Tree (DLTR), Dell Technologies (DELL), VMware (VMW), Analog Devices (ADI)
Friday: Deere & Company (DE)
Source: Zacks, November 20, 2020, Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Any investment should be consistent with your objectives, time frame and risk tolerance. 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.
Quote of the Week
“Vegetables are a must on a diet. I suggest carrot cake, zucchini bread, and pumpkin pie.”
– Jim Davis
Tax Tips
Tips to Protect Yourself From Identity Theft
Tax-related identity theft is when someone uses your personal information to file a fraudulent tax return. They can use information like your Social Security number and other personal details.
Here are some tips to protect yourself:
- Always use security software on your computer, including anti-virus protection.
- Use a strong and unique password for each of your online accounts.
- Look out for spam calls, emails, and texts and report them to the IRS.
- Protect your information and any of your dependents’ info, as well.
Today’s identity criminals are getting more creative, but you can protect yourself by taking these important steps. Always be careful of who you give your information to.
* This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax professional.
Tip adapted from IRS[5]
Have investment questions? Call us at 1.800.626.1027 or email us at invest@pennadvisors.com.
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Footnotes, disclosures and sources:
Investment advisory services are provided through Penn Investment Advisors, Inc. (PIA), a Registered Investment Adviser. PIA is a wholly-owned subsidiary of Penn Community Bank (Bank). Investment products, securities and services offered by PIA are not a deposit of, or obligation of, or guaranteed by the Bank, or an affiliate of the Bank, are not insured by the FDIC or any agency of the United States, the Bank, or any affiliate of the bank and involve investment risk, including the possibility of loss of principal. Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values. Diversification does not guarantee profit nor is it guaranteed to protect assets.
International investing involves special risks such as currency fluctuation and political instability and may not be suitable for all investors.
The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.
The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the NASDAQ. The DJIA was invented by Charles Dow back in 1896.
The Nasdaq Composite is an index of the common stocks and similar securities listed on the NASDAQ stock market and is considered a broad indicator of the performance of stocks of technology companies and growth companies.
The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indexes from Europe, Australia and Southeast Asia.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.
Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
Past performance does not guarantee future results.
You cannot invest directly in an index.
Consult your financial professional before making any investment decision.
Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.
These are the views of Penn Investment Advisors, Inc., and other listed sources. This should not be construed as investment advice. Penn Investment Advisors, Inc., does not give tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information. By clicking on these links, you will leave our server, as they are located on another server. We have not independently verified the information available through this link. The link is provided to you as a matter of interest. Please click on the links below to leave and proceed to the selected site.
[1] The Wall Street Journal, November 20, 2020
[2] The Wall Street Journal, November 20, 2020
[3] The Wall Street Journal, November 20, 2020
[4] CNN.com, November 17, 2020
[5] IRS.gov, March 4, 2020