November 22-26, 2021 Recap
I like to read short updates through a long term filter.
If you aren't willing to own a stock for 10 years, don't even think about owning it for 10 minutes.” Warren Buffet
Post-Thanksgiving Day Selloff
Stocks Tumble
Global stocks retreated last week amid reactionary fears over a warning of a newly discovered COVID-19 variant. The World Health Organization (WHO) said late Thursday that the South African strain, dubbed “omicron,” poses the latest threat to slow the global spread of COVID-19. Friday’s half-day session was the worst post-Thanksgiving Day performance for the S&P 500 since 1941. Travel and leisure stocks fell the most on Friday, while stay-at-home themed companies rallied.
For the Week…
Among the three major U.S. equity indices, the S&P 500 fell 2.18%, the Dow Industrials shed 702 points (905 points on Friday) for a net 1.97% loss and the tech-heavy Nasdaq Composite suffered the largest pullback, down 3.52%. The small cap-focused Russell 2000 had an even deeper weekly selloff, down 4.13%.
Consumer Sentiment Declines
Consumer sentiment eroded sharply in November on inflationary pressures. The University of Michigan’s final November sentiment reading fell to 67.4 from 71.7 the month prior. One-in-four survey respondents noted a decline in living standards as a result of inflation and see spending cutbacks in the coming months.
Energy is the Only Gainer
10 of the 11 major S&P 500 sector groups ended negative last week, with Consumer Discretionary (-3.61%), Communication Services (-3.25%) and Technology (-3.23%) falling the most. Financials (-0.58%) and Consumer Staples (-0.21%) declined the least while Energy (+1.66%) outperformed on strong early week gains. Energy fell the most on Friday, down just over 4%.
Treasury Prices Climb
On Friday, Treasury prices jumped on safe-haven buying, sending yields down the most since March 2020. Yet for the week, the yield on benchmark 10-year Treasury notes declined just six basis points lower (-0.06%) to 1.477%. The U.S. Dollar Index strengthened for a fifth consecutive week, albeit up just 0.06%. U.S. WTI crude oil futures were down 10% last week, ending Friday at $68.15/barrel.
Recovery is Still Steady
10 of 13 indicators in our Recovery Dashboard improved last week. There was a rise in most mobility-related metrics because of Thanksgiving. Consumer confidence is beginning to move higher again, and jobless claims fell to a 52-year low last week.
