Mixed Reaction from Markets

Markets drifted lower last week as uninspired investors digested mixed news on the economic front.

The Dow Jones Industrial Average lost 0.91% while the Standard & Poor’s 500 slid 1.48%. The Nasdaq Composite index stumbled 1.54% for the week. The MSCI EAFE index, which tracks developed overseas stock markets, slipped 0.26%.1,2,3

Stocks Drift Lower

Stocks traded without much conviction last week, pushed lower, in part, by a broad retreat in technology. Rising interest rates also dampened enthusiasm, feeding concerns over their effect on current stock valuations.

Markets seemed deaf to a stream of news, moving little on the House impeachment vote, encouraging news on the vaccine front, reassurances from Fed Chair Powell, or a jump in jobless claims. Energy and financials continued their recent advance, while smaller capitalization stocks rose on expectations of becoming beneficiaries of any stimulus bill.4,5

Stocks turned lower to close the week, following the unveiling of president-elect Biden’s stimulus plan and a weaker-than-expected retail sales number.6

New Stimulus Proposal

Biden revealed his long-anticipated stimulus proposal last week, announcing a $1.9 trillion spending plan to provide further help to an unsteady economy.

Along with monetary easing, fiscal stimulus has been one of the major drivers of the stock market recovery, which is why investors have anxiously awaited his plan.

His proposal seeks to help individuals, including direct payments for qualifying Americans and enhanced unemployment aid. The proposal would also include help for small businesses with a new grant program in addition to the Paycheck Protection Program, and would bolster state finances by funding frontline workers, vaccine distribution, reopening schools, and vital services.

The market reaction was muted. Investors will be watching the extent to which Congress amends Biden’s proposal and the speed at which it’s picked up by the legislature.

This Week: Key Economic Data

Thursday: Housing Starts. Jobless Claims.
Friday: Existing Home Sales. PMI (Purchasing Managers’ Index) Composite Flash.

Source: Econoday, January 15, 2021
The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.

This Week: Companies Reporting Earnings

Tuesday: Netflix (NFLX), Bank of America (BAC), Goldman Sachs (GS), J.B. Hunt Transportation (JBHT).
Wednesday: UnitedHealth Group (UNH), Morgan Stanley (MS), United Airlines (UAL).
Thursday: IBM (IBM), CSX Corporation (CSX), Union Pacific (UNP).
Friday: Kansas City Southern (KSU), PPG Industries (PPG).

Source: Zacks, January 15, 2021

Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.

“Nature has undoubtedly mastered the art of winter gardening and even the most experienced gardener can learn from the unrestrained beauty around them.”

– Vincent A. Simeone

Need Last Year’s Tax Returns?

Help is available for taxpayers who need tax information for prior years, but who did not keep copies of their returns. There are ways to get the information you need.

Keep in mind the IRS recommends that taxpayers keep copies of their returns and any documentation for at least three years after they are filed:

  • Ask your software provider or tax preparer. This is often the easiest way to get a copy of your tax returns.
  • Order a tax transcript. Taxpayers who cannot get a copy of a prior-year return may order a tax transcript from the IRS. To protect taxpayers’ identities, this document partially masks personally identifiable information such as names, addresses and Social Security numbers. All financial entries, including the filer’s adjusted gross income, are fully visible. These are free and available for the most current tax year after the IRS has processed the return. People can also get these records for the past three years.
  • Pay for a copy from the IRS. As a last resort, you can purchase a copy of your tax return from the IRS. Check irs.gov for the most recent information on the process to follow when ordering a copy and the cost of the return.

* This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax professional.

Tip adapted from IRS7

Being SMART About Fitness Goals

Putting exercise on the backburner? You might want to make it a priority. Here’s why. “For many of us, the struggle isn’t knowing what to do or not having options, it’s actually doing it,” says Olga Hays, an American Council on Exercise-certified wellness promotion specialist at Sharp HealthCare. “With so much disruption and uncertainty in our lives, it is simply too tempting to put exercising on the back burner.”

According to Hays, in order to stick with a workout regimen, you need to be intentional about making regular physical activity one of your priorities. Here’s where setting SMART goals can help.

Instead of simply saying you’re going to “exercise more,” state a SMART exercise goal. SMART stands for:

  • Specific: State the objective you wish to meet as specifically as possible: “I am going to commit to doing a full-body video workout several times a week.”
  • Measurable: Identify quantifiable criteria to allow you to measure your progress: “I am going to do this workout three times a week for at least 30 minutes each time. I will track my progress in my workout journal.”
  • Attainable: Your goal should be ambitious, but not impossible: “I am committing to three times a week, not seven times a week, because it is realistic and achievable for me with my current schedule.”
  • Relevant: The goals you set need to align with your current circumstances and priorities: “I will do it to stay healthy and strong during these times and to feel less stressed.”
  • Time-bound: Allocate a specific time period for completing your goal: “I will commit to this plan for a month. In 30 days, I will have had 12 workouts and will reassess my goal after that.”

Tip adapted from Sharp.com8

Four cars approach an intersection with four-way stop signs simultaneously, each car coming from a different direction. After stopping, the drivers all accelerate at the same time. However, there is no accident. How is this possible?

Last week’s riddle: Yesterday was Wednesday’s tomorrow. Tomorrow is Sunday’s yesterday. Given those circumstances, what day would today be?  Answer: Friday.

Tenerife, Canary Islands, Spain.