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Weekly Market Performance — Markets Pull Back For Second Straight Week

Index Performance

weekly performance

U.S. and International Equities

Major Markets Finish Lower Amid Delta Earnings Growth Concerns

The major markets finished lower for a second straight week. Friday’s quadruple witching where individual stock options and futures, along with index options and futures all expire on the same day, Delta variant cases and thus earnings concerns all played a role in traders selling equities this week. Emerging markets, as represented by the MSCI EM Index, was the biggest detractor on the backs of increased Chinese regulations.

Energy Propels Through a Tough Week

Energy stocks, which have pulled back this summer, caught a bid this week as concerns mount over lower than expected worldwide supply. Concerns abound over China not having enough coal and natural gas despite the country’s attempt over the past year to stockpile energy as rivals in North Asia and Europe compete for a finite supply. Growth stocks outperformed value on downward revised GDP expectations.

Fixed Income and Commodities Recap

Bonds Finish Higher while Oil/Natural Gas Have a Positive Week

The bellwether Bloomberg Barclays Aggregate Bond Index finished higher for the third week in a row, even with better than expected economic reports this week, but the year-to-date returns are still negative. Moreover, the 10-year Treasury yield increased ahead of the Federal Reserve’s meeting next week. Credit, as represented by the Bloomberg Barclays Credit Index, was a top-performing bond index for the second week in a row. Both oil and natural gas finished solidly in the green in the midst of supply concerns.

Economic Weekly Roundup

Retail Sales Beat Expectations While CPI Moderated

The U.S. Bureau of Labor Statistics released August data for the Consumer Price Index (CPI) Tuesday showing that headline CPI climbed 0.3% month over month. Meanwhile, core CPI, which does not include food and energy prices, rose a modest 0.1% month over month. Both statistics came in lower than expected.

The U.S. Census Bureau released August retail sales on Thursday reporting that retail sales grew almost 1% month over month vs. expectations for a decline. In addition, while retail sales, not including auto sales and gas, came in even better than expected by increasing 2% month over month vs. the consensus estimate of unchanged.

Other highlights from this week’s economic calendar include:

  • Unemployment claims were reported this week at just above economists’ expectations, however continuing claims came in below expectations and continue to show improvement.

The highlight of next week’s economic calendar is undoubtedly the Federal Reserve Open Market Committee meeting on Wednesday. In addition, the following economic data is slated to be released during the week ahead:

  • Monday: September National Association of Home Builders’ housing market index
  • Tuesday: August building permits and housing starts, Q2 Current Account
  • Wednesday: August existing home sales
  • Thursday: Weekly initial and continuing unemployment claims, August Leading Indicators, Markit September Purchasing Managers’ Index
  • Friday: August new home sales

IMPORTANT DISCLOSURES

This material is for general information only and is not intended to provide specific advice or recommendations for any individual. There is no assurance that the views or strategies discussed are suitable for all investors or will yield positive outcomes. Investing involves risks including possible loss of principal. Any economic forecasts set forth may not develop as predicted and are subject to change.

References to markets, asset classes, and sectors are generally regarding the corresponding market index. Indexes are unmanaged statistical composites and cannot be invested into directly. Index performance is not indicative of the performance of any investment and do not reflect fees, expenses, or sales charges. All performance referenced is historical and is no guarantee of future results. All market and index data comes from FactSet and MarketWatch.

Any company names noted herein are for educational purposes only and not an indication of trading intent or a solicitation of their products or services. LPL Financial doesn’t provide research on individual equities. All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.

U.S. Treasuries may be considered “safe haven” investments but do carry some degree of risk including interest rate, credit, and market risk. Bonds are subject to market and interest rate risk if sold prior to maturity. Bond values will decline as interest rates rise and bonds are subject to availability and change in price.

For a list of descriptions of the indexes referenced in this publication, please visit our website at lplresearch.com/definitions.

This Research material was prepared by LPL Financial LLC.

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