Week Ended January 14, 2011
Stocks continued to advance
in the second week of the year, bringing the large-cap indexes to their best
level since the summer of 2008 and helping the S&P MidCap 400 end the week
at an all-time high. Investors started the week in a cautious mood, concerned
over reports that Portugal might be forced to follow Ireland and Greece in
accepting a bailout from international lenders. These fears eased somewhat as
the week progressed, and markets moved sharply higher on Wednesday as investors
were relieved to see a successful auction of Portuguese government debt. Stocks
slipped back a bit on Thursday when the Labor Department reported a surprising
jump in weekly jobless claims, although some observers questioned whether
recent snowstorms had inflated the numbers by delaying earlier filings. More
economic news arrived Friday, when the Federal Reserve announced a
larger-than-expected rise in industrial production in December. The Commerce
Department reported that retail sales grew 0.6% for the month, slightly short of
expectations. The week also saw the beginnings of the fourth-quarter earnings
reporting season. Investors were somewhat disappointed in sales growth at
industrial bellwether Alcoa, but the first major bank to report, J.P. Morgan
Chase, announced profits that topped expectations.
U.S. Stocks1 |
|||
Index2 |
Friday's Close |
Week's Change |
% Change |
DJIA |
11787.38 |
112.62 |
1.81% |
S&P
500 |
1293.24 |
21.74 |
2.83% |
NASDAQ
Composite |
2755.30 |
52.13 |
3.86% |
S&P
MidCap 400 |
931.07 |
20.54 |
2.63% |
Russell
2000 |
807.21 |
20.18 |
2.79% |
This chart
is for illustrative purposes only and does not represent the performance of any
specific security. Past performance cannot guarantee future results.
1Source of data Reuters, obtained through Yahoo! Finance Closing
data as of 4:10 p.m. ET.
2The Dow Jones Industrial Average and the Standard & Poor's 500
Stock Index of blue chip stocks, the Standard & Poor's MidCap 400 Index,
and the Russell 2000 Index are unmanaged indexes representing various segments
by market capitalization of the U.S. equity markets. The Nasdaq Composite is an
unmanaged index representing the companies traded on the Nasdaq stock market
and the National Market System.
____________
Week Ended January 14, 2011
The U.S. economy ended 2010
on an encouraging note, according to the Federal Reserve's Survey of Economic
Conditions. Fed Chairman Ben Bernanke predicted that the U.S. economy would
continue to strengthen in 2011, although he thought it might take as long as
five years for unemployment, now at 9.4%, to fall to a historically normal
level of about 6%. The labor market is not the only discouraging area; real
estate also looks fairly bleak, with home values down 26% from their peak in
June 2006, the steepest decline since the 1930s, according to online real
estate database Zillow. RealtyTrak expects foreclosures this year to surpass
the record 1 million foreclosures that occurred in 2010, as a large number
of unemployed homeowners struggle to make payments. The most problematic areas
are the ones that experienced the biggest booms, namely Nevada, Arizona,
Florida, and California. At the same time, inflation has been creeping up,
posting its largest increase in nearly a year at the end of December. Much of
the rise was attributed to higher food and energy costs. Treasury yields were
mostly stable during the week, closing near their levels of a week earlier.
U.S. Treasury Yields1 |
||
Maturity |
January 14, 2011 |
January 7, 2011 |
2-Year |
0.58% |
0.59% |
10-Year |
3.32% |
3.32% |
30-Year |
4.53% |
4.47% |
This table is for
illustrative purposes only. Past performance cannot guarantee future
results.
1Source of data: Bloomberg.com, as of 4
p.m. ET Friday, January 14, 2011.
___________
Week Ended January 07, 2011
International
Stocks
Foreign stock markets closed lower for the week ending January
07, 2011 with the broad international measure, the MSCI EAFE Index (Europe,
Australasia, and Far East), losing -0.82%.
|
||
Region/Country |
Week's Return |
% Change Year-to-Date |
EAFE |
-0.82% |
-0.82% |
Europe ex-U.K. |
-2.47% |
-2.47% |
Denmark |
-1.22% |
-1.22% |
France |
-1.59% |
-1.59% |
Germany |
-2.76% |
-2.76% |
Italy |
-1.18% |
-1.18% |
Netherlands |
-2.39% |
-2.39% |
Spain |
-6.07% |
-6.07% |
Sweden |
-2.09% |
-2.09% |
Switzerland |
-2.62% |
-2.62% |
United
Kingdom |
0.93% |
0.93% |
Japan |
0.78% |
0.78% |
AC
Far East ex-Japan |
1.55% |
1.55% |
Hong Kong |
4.68% |
4.68% |
Korea |
2.94% |
2.94% |
Malaysia |
4.05% |
4.05% |
Singapore |
1.34% |
1.34% |
Taiwan |
-2.92% |
-2.92% |
Thailand |
0.26% |
0.26% |
EM
Latin America |
-0.72% |
-0.72% |
Brazil |
-0.51% |
-0.51% |
Mexico |
1.24% |
1.24% |
Argentina |
0.81% |
0.81% |
EM
(Emerging Markets) |
-0.35% |
-0.35% |
Hungary |
1.96% |
1.96% |
India |
-5.14% |
-5.14% |
Israel |
-0.58% |
-0.58% |
Russia |
-0.66% |
-0.66% |
Turkey |
1.69% |
1.69% |
International
Bond Markets
International bond markets in developed countries were lower
this week, with the J.P. Morgan Global Government Bond Less U.S. Index losing
-2.75%.
|
||
Region/Country |
Week's Return |
% Change Year-to-Date |
Developed
Markets |
-2.75% |
-2.75% |
Europe |
|
|
Denmark |
-2.91% |
-2.91% |
France |
-3.11% |
-3.11% |
Germany |
-2.97% |
-2.97% |
Italy |
-3.29% |
-3.29% |
Spain |
-3.60% |
-3.60% |
Sweden |
-2.18% |
-2.18% |
United
Kingdom |
-1.62% |
-1.62% |
Japan |
-2.75% |
-2.75% |
Emerging
Markets |
0.60% |
0.60% |
Argentina |
0.61% |
0.61% |
Brazil |
1.35% |
1.35% |
Bulgaria |
-0.07% |
-0.07% |
Russia |
0.33% |
0.33% |
International
Currency Markets
On the currency front, the U.S. dollar was stronger against the
major currencies for the week.
|
|||
Currency |
Close |
Week's Return |
% Change |
Japanese
yen |
82.975 |
2.25% |
2.25% |
Euro |
1.29831 |
3.23% |
3.23% |
British
pound |
1.55711 |
0.55% |
0.55% |
1U.S. dollars per national currency
unit.
Sources: Foreign stock markets and currency sections are from
Rimes Technologies, using MSCI data. International bond markets are from J.P. Morgan.
Note: All returns are in U.S. dollars. All bond indices are J.P.
Morgan. All stock indices are Morgan Stanley Capital International (MSCI).
Equity Indices |
|
EAFE: |
MSCI
Europe, Australasia, and Far East Index |
Europe
Ex-U.K.: |
MSCI
Europe ex-U.K. Index |
Far East
Ex-Japan: |
MSCI AC
Far East ex-Japan Index |
Latin
America: |
MSCI
Emerging Markets Latin America Index |
Emerging
Markets: |
MSCI
Emerging Markets Index |
Bond Indices |
|
Developed
Markets: |
J.P.
Morgan Global Government Bond Less U.S. Index |
Emerging
Markets: |
J.P.
Morgan Emerging Markets Bond Index Plus |
All charts are for illustrative purposes only and do not represent the
performance of any specific security. Past performance cannot guarantee
future results.