The Week on Wall Street
Stocks soared last week as investors anticipated that a split Congress would raise legislative hurdles to change corporate taxes and adjusting regulatory oversight of big technology companies.
FACT OF THE WEEK
Established in 1919, Children's Book Week is the longest-running national literacy initiative, with two weeks of dedicated celebrations during May 4-10 and Nov 9 - 15. There are tons of ways to get involved in the fun, not only in celebration of books but also to promote connection through events held nationwide at schools, libraries, bookstores, and homes.
The Dow Jones Industrial Average jumped 6.87%, while the S&P 500 tacked on 7.32%. The Nasdaq Composite Index surged 9.01% for the week. The MSCI EAFE Index, which tracks developed overseas stock markets, rose 7.65%.
Bulls Take Charge
Coming off a poor close to October, stocks surged throughout election week, jumping higher in pre-election trading on bargain hunting and stable factory activity. The rally picked up steam as Americans went to the polls and shifted into overdrive Wednesday morning.
Investors were buoyed by Congressional results that indicate that the next president would have to work with a divided Congress. Though a split Congress might result in a smaller potential stimulus package and continued gridlock, investors seemed to believe outweighed by a diminished risk of higher taxes, greater regulation, and policy initiatives that might be challenging to businesses.
A pause in stock activity closed out the week, even as a recent jobs report saw the unemployment rate fall a full percentage point to 6.9%.
Overlooked amid the active rally in stock prices was the swing in yields last week. Action in the bond market is crucial since 10-year Treasury yields are a benchmark for setting borrowing costs for businesses, and they represent another view on the strength of the economic recovery.
The 10-year Treasury note rose as high as 0.942% during after-hours trading on election evening and dropped to 0.768% by the end of regular trading hours on Wednesday.
FINANCIAL STRATEGY OF THE WEEK
Tax time is upon us, and that means gathering all of your documents needed and getting them in one place to make filing your taxes as easy as possible. We thought it would be helpful to send along this handy checklist to help with that.
You can download and print the Year-End Checklist if you’d like to have a hard copy.
As always, please let us know if there is anything we can help with along the way or any financial concerns you may have.