Global stock markets had another solid month, generating returns in excess of 4% during April. Domestic stocks led the way, thanks to strong corporate profits, ongoing government stimulus, and progress on vaccinations.
The $1.9 trillion stimulus bill is more of the same, emergency measures and safety-net expansions. These trends have been with us for the past forty years … under presidents of both parties … as federal income support rose by more than half to 4.3% of GDP from 1979 to 2019.
Stock markets continued their advance during March, closing out another strong quarter for equity investors. U.S. stocks lead the way with returns of nearly 4% in March and more than 6% for the quarter. Foreign equities were up just over 1% for the month and about 3.5% for the quarter. With quarterly returns in excess of 12%, domestic small-cap stocks were the big winners.
February was a month full of good news. The economy continued to gain strength, vaccine doses were on the rise, a new stimulus package was on the horizon, and the Fed (yet again) pledged to maintain its easy-money policies. For most of the month, equity markets were embracing the optimism.
Stocks started the new year off with strong gains, but ended January with the worst weekly declines since October. When the dust had settled, global stock measures were only slightly off for the month.
Working from home has unleashed an unparalleled period of growth for grocery goods. Global Workplace Analytics estimates that about one-quarter of U.S. workers will remain at home by the end of 2021, compared to only 4% prepandemic.
Global stock markets gained roughly 5% during December, closing out a tumultuous but successful 2020 performance. After losing about one-third of their value in the 23 trading days ended March 23, global stocks bounced back to gain in excess of 16% for the year.
Stocks soared in November, as impressive news on the vaccine front propelled global markets to double-digit returns. U.S. markets were led by smaller companies, which rocketed more than 18% during the month. Value stocks continued to outperform their growth counterparts, as investors favored businesses that were hardest hit by the pandemic. With the dollar reaching a two-year low against other world currencies, foreign stock returns outpaced domestic markets.
Although economic data and corporate earnings continued to show solid improvement, domestic stock markets were down in October. After peaking in early September, all three major indexes – The Dow, S&P 500, and Nasdaq Composite – registered declines for the second straight month. Market activity reflected fears associated with growing coronavirus infections and the related concerns that any new lockdowns could derail the current economic rebound.
Pew Research Center, after polling nearly 15,000 residents worldwide, found 73% on average see China in an unfavorable light … China’s worst score since the survey began. The survey also found 78% of respondents had little or no confidence in President Xi Jinping.