Market Data as of Week Ending: 8/13/2021 unless noted otherwise
U.S. stock prices crept higher last week, extending their recent run of small gains amid quiet trading. Investors continue to shrug off the renewed spread of the coronavirus as U.S. economic data has proved resilient to Delta variant concerns. With earnings season nearing the finish line, roughly 83% of the companies have topped revenue forecasts, and approximately 85% have bested earnings estimates. Large cap companies outperformed their small and mid cap peers while value stocks outperformed their growth counterparts. Most sectors advanced, led by materials and consumer staples. Energy stocks retreated as concerns that the spread of COVID-19 infections could weigh on global demand. Information technology and consumer discretionary also lagged driven by the weakness in the semiconductor industry. Developed foreign stocks in Europe and Asia edged out U.S. stocks while Emerging Market stocks underperformed both developed foreign and U.S. markets.
U.S. Treasury yields remained relatively unchanged as economic data delivered mixed messages. The 10-year ended the week at 1.28%. Long-term government bonds were the best performing segment while short-term high yield bonds lagged. Investment grade corporate bonds ended the week with yields near the same level at approximately 2.0% and high yield corporate bonds rose to just over 4.7%.
Economic data was somewhat mixed for the week. The number of job openings rose to a record 10.1 million in June, making it the fourth straight all-time monthly high. The NFIB small-business index fell to 99.7 in July as business owners are losing confidence in the strength of the economy and expect a slowdown in job creation. U.S. consumer prices may be showing signs of moderating as July’s CPI decreased by 0.4% to 0.5%, mostly led by the moderation in used car prices. Producer prices, on the other hand, rose sharply in July for the sixth month in a row. U.S. consumer sentiment took a blow as it fell to 77.9 in August’s early report, its lowest reading since December 2011. Japanese wholesale prices rose by an annualized rate of 5.6% in July, their quickest annual rate in 13 years, mainly due to rising import costs amid surging commodity prices.