“Santa Rally” Arrives on Cue

After shaking out bears and nervous hands in early December, the Santa Claus rally arrived, almost right on cue.  Last week ended with a 3-day, 3+% rally that took the S&P 500 to a new closing high at 4726. It was a broad advance as all the major indices closed the week with gains.  Omicron, inflation, interest rate headlines sparked early December volatility, but the stock market continues its bullish trend for 2021 in December.

The S&P 500 rose 2.28% overall last week, outperforming much of the world despite the spike in COVID cases.  Senator Manchin levied a death blow to the overly aggressive version of President Biden’s Build Back Better Plan. Gains were broad-based in the markets, with both technology shares and “reopen” sectors like cruise lines and concert operators leading.

The MSCI Europe rose 2.31%, powered by cyclicals like energy and industrials. Emerging markets (think China, Russia, and Brazil) lagged developed markets again and risk finishing 2021 in the red as political developments in South America have driven markets downward.

In the four weeks since Omicron first appeared, markets have been waffling at the ultimate economic impact of the new variant. For equity markets and short-term rate expectations, the net effect has been almost a draw, with the S&P 500 now up slightly from its pre-Thanksgiving close, and two-year Treasury yields up 5 bps over that period. The key takeaway here is that investors expect Omicron to be a hurdle for growth in the first half of 2022 but not cause a large scale slowdown.

Oak Harvest YouTube Channel

https://www.youtube.com/channel/UCkLvOm9F5iC01-hHxRmUXpQ

Stock Talk Podcast (Weekly Market News and Opinion from Oak Harvest):

https://oakharvestfg.com/stock-talk-podcast/

The Investor Mindset Podcast (Introduction to Critical Concepts for Investors):

https://oakharvestfg.com/investor-mindset/

 

First Half 2022 Outlook – Curb Your Enthusiasm Yield a Bull Market Buy.

https://www.youtube.com/watch?v=Ybk6bjjkILQ

 

This content contains general information and express the views of Oak Harvest Investment Services. All data, articles, and information cited are believed to be reliable at the time of creation; however, Oak Harvest does not warrant any information contained herein to be correct, complete, accurate or timely.

Oak Harvest provides links to content produced by other websites that OHFG does not control, and Oak Harvest does not necessarily approve or endorse such content and does not guarantee its accuracy. Nothing in this content constitutes personalized investment advice. Any charts, indicators, or graphs included or referenced in this content have limitations, and no such material is able, in and of itself, to provide a buy or sell recommendation for any security. Strategies and ideas discussed may not be right for you, and views and opinions expressed may change without notice. Strategies and ideas discussed will not apply to all client accounts or portfolios.

Nothing in this content constitutes a recommendation, or an offer or solicitation to buy or sell securities. Oak Harvest makes no assurance as to the accuracy of any forecast or projection made. Not all past forecasts or projections have been accurate. No current or future forecasts and projections are guaranteed to be accurate.  And future forecasts may not be as accurate as any forecasts discussed. Indexes like the S&P 500 are not available for direct investment and your results will differ. Past performance is not indicative of future results. Investing involves the risk of loss.