Weekly Market Update, January 4, 2016

Presented by Nick Bautista, CFP®                      

General market news

  • The 10-year Treasury opened 2016 with a yield of 2.29 percent before promptly dropping to as low as 2.20 percent. The 30-year Treasury also dipped from a 3.03-percent open to 2.95 percent in the first few hours of trading. The short end of the yield curve moved as well, with the 2-year Treasury opening at 1.06 percent before dropping to 1.02 percent.
  • Global equity markets were a bit volatile last week.
  • In the U.S., equity indices were down as a decline in the price of oil rippled through the markets. The S&P 500 Index decreased 0.80 percent, and the Russell 2000 Index dropped 1.57 percent.
  • Internationally, the MSCI EAFE Index declined 0.26 percent while the MSCI Emerging Markets Index decreased 1.22 percent.

 

Equity Index Week-to-Date Month-to-Date Year-to-Date 12-Month
S&P 500 −0.80% −1.59% 0.33% 0.33%
Nasdaq Composite −0.79% −1.88% 6.18% 6.18%
DJIA −0.72% −1.52% −0.68% −0.68%
MSCI EAFE −0.26% −1.32% −0.39% −0.39%
MSCI Emerging Markets −1.22% −2.37% −14.67% −14.67%
Russell 2000 −1.57% −5.02% −5.07% −5.07%

  Source: Bloomberg

 

Fixed Income Index Month-to-Date Year-to-Date 12-Month
U.S. Broad Market −0.32% 0.55% 0.55%
U.S. Treasury −0.16% 0.84% 0.84%
U.S. Mortgages −0.03% 1.51% 1.51%
Municipal Bond 0.70% 3.30% 3.30%

  Source: Morningstar Direct

 

What to look forward to  

The week will start with news on manufacturing. The ISM Manufacturing Index is expected to be up very slightly, and Factory Orders are expected to decrease.

Next, we’ll see International Trade data and the latest Federal Open Market Committee meeting minutes.

The week will end with the Employment Situation report for December.

Disclosures: Certain sections of this commentary contain forward-looking statements that are based on our reasonable expectations, estimates, projections, and assumptions. Forward-looking statements are not guarantees of future performance and involve certain risks and uncertainties, which are difficult to predict. All indices are unmanaged and are not available for direct investment by the public. Past performance is not indicative of future results. The S&P 500 is based on the average performance of the 500 industrial stocks monitored by Standard & Poor’s. The Nasdaq Composite Index measures the performance of all issues listed in the Nasdaq Stock Market, except for rights, warrants, units, and convertible debentures. The Dow Jones Industrial Average is computed by summing the prices of the stocks of 30 large companies and then dividing that total by an adjusted value, one which has been adjusted over the years to account for the effects of stock splits on the prices of the 30 companies. Dividends are reinvested to reflect the actual performance of the underlying securities. The MSCI EAFE Index is a float-adjusted market capitalization index designed to measure developed market equity performance, excluding the U.S. and Canada. The MSCI Emerging Markets Index is a market capitalization-weighted index composed of companies representative of the market structure of 26 emerging market countries in Europe, Latin America, and the Pacific Basin. The Russell 2000® Index measures the performance of the 2,000 smallest companies in the Russell 3000® Index. The Barclays Capital Aggregate Bond Index is an unmanaged market value-weighted performance benchmark for investment-grade fixed-rate debt issues, including government, corporate, asset-backed, and mortgage-backed securities with maturities of at least one year. The U.S. Treasury Index is based on the auctions of U.S. Treasury bills, or on the U.S. Treasury’s daily yield curve. The Barclays Capital Mortgage-Backed Securities (MBS) Index is an unmanaged market value-weighted index of 15- and 30-year fixed-rate securities backed by mortgage pools of the Government National Mortgage Association (GNMA), Federal National Mortgage Association (Fannie Mae), and the Federal Home Loan Mortgage Corporation (FHLMC), and balloon mortgages with fixed-rate coupons. The Barclays Capital Municipal Bond Index includes investment-grade, tax-exempt, and fixed-rate bonds with long-term maturities (greater than 2 years) selected from issues larger than $50 million. The Barclays Capital U.S. Treasury Inflation Protected Securities (TIPS) Index measures the performance of intermediate (1- to 10-year) U.S. TIPS.
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Nick Bautista is a financial advisor located at 19712 MacArthur Blvd. Ste 225, Irvine CA 92612. He offers securities and advisory services as an Investment Adviser Representative of Commonwealth Financial Network®, Member FINRA/SIPC, a Registered Investment Adviser. He can be reached at 949-333-6394 or at nick@phillipswealthmanagement.com

Authored by the Investment Research team at Commonwealth Financial Network.

© 2016 Commonwealth Financial Network®

 

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