US Stock Markets Ended Dec. 31, 2020

Bob Carey
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US Stock Markets Ended Dec. 31, 2020

Posted Under: Weekly Market Commentary

Equity markets, as measured by the S&P 500, closed the final week of 2020 up 1.35% with Utilities and Consumer Discretionary sectors leading the way. All told 2020 was a remarkably resilient year for equities as the S&P 500 closed 2020 up 18.39%. In February and March equities were rocked by the global COVID-19 pandemic which caused the quickest peak to trough recession in market history in a mere 33 days. However, the quickest full retracement in market history ensued lasting only 148 days underpinning equity resilience during this pandemic year. For 2020 S&P 500 Information Technology sector was up 42.89% S&P 500 Consumer Discretionary sector was up 33.30% and S&P 500 Communication Services sector was up 23.61% to fuel the S&P 500 gains during 2020. The laggards for 2020 were the S&P 500 Energy sector with a -33.68% return, S&P 500 Real Estate sector -2.17% return and the S&P 500 Financials sector -1.76% return. Fueling much of the return in the S&P 500 were the largest five Tech+ names (Apple Inc, Microsoft Corp, Amazon.com Inc., Google's parent Alphabet Inc. and Facebook Inc.) which were a 16.79% weight in the index to start the year. These five names were up an average of 53.04% and ended the year a remarkable 21.74% weight in the S&P 500 despite Tesla Inc. entering the index on 12/21/2020 at a 1.58% weight taking weight from other names. Looking ahead, next year starts off quickly as next Tuesday there are two U.S. Senate runoffs to determine partisan control of the U.S. Government. If the Democrats win both that would bring the senate to a 50-50 tie which would then have a tie broken by the Vice President-Elect Kamala Harris after her January 20th inauguration. If the Republicans win one of the two Georgia races, they would retain control of the Senate for the next two years dealing a big blow to Democrats hoping to pass progressive initiatives. Currently most polls have a statistical tie (within the margin of error) so it is still up in the air.

Posted on Monday, January 4, 2021 @ 8:12 AM • Post Link	Share:
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These posts were prepared by First Trust Advisors L.P., and reflect the current opinion of the authors. They are based upon sources and data believed to be accurate and reliable. Opinions and forward looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security.

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