US Stock Markets Ended March 19, 2021

The S&P 500 traded modestly lower for the week, with investors balancing an improving economic backdrop with the possibility of higher interest rates. The Federal Reserve reiterated its easy-money policies even with a brightening economic recovery. Both technology shares and financials were lower for the week as higher treasury yields tend to hurt secular growth areas of the market and bank shares were hampered by the Fed not extending increased capital limits on ultrasafe assets. In economic news, retail sales for February fell more than expected partially due to poor weather and a difficult comparison with the previous stimulus checks hitting checking accounts in January. In stock news, FedEx Inc. reported blowout results as profits over doubled versus last year on improved margins in ground. The package carrier is benefiting from a surge in e-commerce coupled with fewer commercial flights that typically stow packages. Plug Power, Inc., one of the best performing stocks over the past year, fell sharply after the hydrogen fuel cell maker said it needs to restate past financial performance as far back as 2018.  Lennar Corp. shares gained after a strong earnings beat and a new joint venture with institutional investors to build affordable homes. In the near-term, equity markets will likely remain volatile as stocks oscillate on treasury yields and the pace of the reopen. Longer-term, equities continue to remain appealing, especially relative to bonds. While some pockets of the market look stretched, many areas look reasonably priced and could continue to inflect higher on the backs of stronger consumers and earnings recovering in economically sensitive stocks.
Posted on Monday, March 22, 2021 @ 8:16 AM

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.