US and International Equities

The S&P 500 Index, Dow Jones Industrial, and Nasdaq Composite indexes, continued their November run in December. As noted last month, November was a record-breaking month for equities, thanks to positive vaccine news, a strong third quarter earnings season, and a likely split Congress. Even in the wake of weak economic data, market participants are looking forward to a new year and a potentially better economic landscape.

Information Technology Sprints Ahead While Financials Rebound

Financials were the best performing sector for December. The sector had been cha

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Markets start the New Year higher. US markets continue their trek higher following last year’s nine-month rally. Market participants appear optimistic for a better 2021 in the wake of COVID-19 vaccine progress and December’s stimulus measures.

• US stocks appear comfortable with the uncertainty ahead of Wednesday’s Georgia Senate runoffs.

• European markets are higher during midday trading, with the Euro Stoxx 50 up more than 1%.

• Asian markets finished mostly higher.

2020 Sector Wrap Up

The S&P 500 Index closed 2020 with a 16.3% gain, led by its la

2020 was an extraordinary year for the Federal Reserve (Fed). The Fed responded swiftly and decisively to the rapidly accelerating financial and economic uncertainty brought on by efforts to contain the COVID-19 pandemic. The current Fed was helped by precedents and policies created during the 2008-09 recession, but also went beyond them to address the specific economic needs of the current crisis. We are not on the other side of that crisis yet, although we’re certainly getting closer, but there’s at least enough perspective to look back at what we learned about the Fed and markets in 2020 as we head into 2021.

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Lessons learned from the Fed in 2020. The Federal Reserve (Fed) will remain in focus for markets in 2021.

• “Don’t fight the Fed” seems like obvious investor guidance in hindsight, but it didn’t in March 2020 and it shouldn’t be forgotten if the economy stumbles again.

• 2020 saw an important pivot in how the Fed thinks about inflation after it created an added buffer against raising rates too soon.

• For more on what the Fed did in 2020 and what it means for 2021, see today’s LPL Research blog.

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Global stocks surge. Stocks around the wo