Stocks declined for the third week in a row to round out the
worst month for the market since the rally began last March. Investors appeared
concerned that quarterly earnings, while generally favorable, did not meet the
high expectations that have been built into stock gains in recent months. The
lukewarm reception given to Apple’s new tablet computer may have helped lead
the technology sector sharply lower on Thursday. Early in the week, investors
also seemed concerned about a rising tide of populist anger in Washington,
which threatened to have a particular impact on the financials sector. The
rising anger at the banking bailout and other measures appeared for a time to
threaten the reappointment of Federal Reserve Chairman Ben Bernanke, although
he was confirmed for another term by the Senate on Thursday. The week’s
economic news was mixed. Weekly jobless claims did not come down as much as
many hoped, and existing home sales plunged in December. On the brighter side,
durable goods orders outside of the transportation sector showed a good gain in
December. The Commerce Department also reported its advance estimate that the
economy had grown at an annualized rate of 5.7% in the final quarter of 2009,
its best showing in six years and well above consensus expectations.
|
U.S.
Stocks1 |
|||
|
Index2 |
Friday’s Close |
Week’s Change |
% Change |
|
DJIA |
10067.33 |
-105.65 |
-3.46% |
|
S&P
500 |
1073.87 |
-17.89 |
-3.70% |
|
NASDAQ
Composite |
2147.35 |
-57.94 |
-5.37% |
|
S&P
MidCap 400 |
702.80 |
-18.85 |
-3.29% |
|
Russell
2000 |
603.51 |
-14.37 |
-4.82% |
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
29, 2010
The U.S. economy grew at an
annualized rate of 5.7% in the fourth quarter of 2009, according to initial
estimates. The robust activity was driven largely by federal stimulus packages.
Recent data suggest, however, that the rate of growth is slowing in the first
quarter of 2010 as companies remain reluctant to expand capacity and step up
their hiring, which puts ongoing pressure on the labor market. The Federal Open
Market Committee (FOMC) met during the last week of the month and stated that
“economic activity has continued to strengthen,” but the FOMC also cited
ongoing weakness in both the housing and labor markets. The FOMC decided to
leave short-term interest rates near 0% as expected, but the decision was not
unanimous. Kansas City Federal Reserve President Thomas Hoenig voted against
it, fueling speculation that the Fed could be closer to raising rates than most
analysts anticipated. Treasury rates were fairly stable during the week,
closing near their levels of the week before.
|
U.S.
Treasury Yields1 |
||
|
Maturity |
January 29, 2010 |
January 22, 2010 |
|
2-Year |
0.83% |
0.78% |
|
10-Year |
3.60% |
3.58% |
|
30-Year |
4.50% |
4.51% |
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 29, 2010.
____________________________
Week Ended January 22, 2010
International
Stocks
Foreign stock markets closed higher for the week ending January
22, 2010 with the broad international measure, the MSCI EAFE Index (Europe,
Australasia, and Far East), losing -3.73%.
|
|
||
|
Region/Country |
Week’s Return |
% Change Year-to-Date |
|
EAFE |
-3.73% |
-0.92% |
|
Europe ex-U.K. |
-4.48% |
-3.70% |
|
Denmark |
-4.56% |
1.67% |
|
France |
-4.89% |
-4.05% |
|
Germany |
-4.75% |
-5.64% |
|
Italy |
-5.34% |
-4.20% |
|
Netherlands |
-3.97% |
-2.58% |
|
Spain |
-5.63% |
-6.46% |
|
Sweden |
-4.31% |
-1.09% |
|
Switzerland |
-2.68% |
-1.16% |
|
United
Kingdom |
-3.51% |
-2.11% |
|
Japan |
-1.94% |
7.21% |
|
AC
Far East ex-Japan |
-4.35% |
-2.53% |
|
Hong Kong |
-4.22% |
-4.29% |
|
Korea |
-3.28% |
0.98% |
|
Malaysia |
-1.98% |
2.65% |
|
Singapore |
-3.77% |
-3.15% |
|
Taiwan |
-6.22% |
-3.70% |
|
Thailand |
-5.17% |
-2.41% |
|
EM
Latin America |
-5.78% |
-5.56% |
|
Brazil |
-6.10% |
-6.96% |
|
Mexico |
-6.08% |
-4.92% |
|
Argentina |
-4.31% |
-0.99% |
|
EM
(Emerging Markets) |
-4.62% |
-2.54% |
|
Hungary |
-6.63% |
1.59% |
|
India |
-4.85% |
-1.79% |
|
Israel |
-0.96% |
2.90% |
|
Russia |
-4.36% |
3.11% |
|
Turkey |
-2.11% |
1.39% |
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
-0.47%.
|
|
||
|
Region/Country |
Week’s Return |
% Change Year-to-Date |
|
Developed
Markets |
-0.47% |
1.06% |
|
Europe |
|
|
|
Denmark |
-1.55% |
-0.28% |
|
France |
-1.45% |
-0.54% |
|
Germany |
-1.38% |
-0.32% |
|
Italy |
-1.78% |
-1.22% |
|
Spain |
-2.22% |
-1.83% |
|
Sweden |
-1.83% |
-0.42% |
|
United
Kingdom |
-0.75% |
0.35% |
|
Japan |
0.88% |
3.19% |
|
Emerging
Markets |
-0.58% |
0.23% |
|
Argentina |
-1.65% |
-6.63% |
|
Brazil |
-0.28% |
-0.10% |
|
Bulgaria |
-0.31% |
0.19% |
|
Russia |
-0.33% |
0.91% |
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 |
90.085 |
-0.86% |
-3.34% |
|
Euro |
1.41291 |
1.67% |
1.52% |
|
British
pound |
1.61251 |
0.79% |
0.15% |
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.