Weekly Market Commentary

2021 was a fizzing mints-in-soda kind of year.

Investors were feeling bullish.

Stock and bond markets diverged. 

Last week, the Bank of England surprised markets with a rate hike, its first in three years, and the Bank of Mexico raised rates more than expected. Both cited persistent inflation as the reason for the increases, reported Carla Mozée of Markets Insider. 

Inflation met expectations.

When the Bureau of Labor Statistics released the Consumer Price Index (CPI) last week, it showed that inflation was at levels last seen in 1982. In November, prices were up 0.8 percent month-to-month and 6.8 percent year-to-year.

Investors look to the future.

Last week, employment and manufacturing data confirmed that the United States economy continued to strengthen in November, but positive economic news was overshadowed by investors’ concerns about the spread of coronavirus and Federal Reserve policy.

Let’s start with the economic news.

COVID-19 strikes again. 

The Markets

Thinking about the possibilities.

The Markets

Economists like to joke that inflation is just right when no one notices it.

Feeling bullish…

Investor bullishness ticked higher last week on all four investor sentiment gauges tracked by Barron’s. Investor optimism may have been fanned by positive financial and economic news. For example, last week:

The road to recovery is slow and bumpy.