First off, it is the time of year when I want to invite you to come into the office for an account review. To make an appointment, you simply go to our Legacy Wealth Planning website, click on the “Make an Appointment” tab and then click on Mark Levy. It will bring up my calendar and you can pick your date and time. If you are not exactly computer savvy, please call our office at 775-850-2500 and any of the staff will put your appointment on my calendar. I realize COVID-19 is still occurring, but here in the office we are careful by staying 6 feet apart and wear masks. If you prefer an appointment by phone, just say so on your appointment, or if your computer has a camera, say Zoom on your appointment and I can email you a Zoom invite to join. I look forward to seeing you soon.

The equity markets today are up. The Dow 30 Industrial Average is trading at 31,973. The Nasdaq has been underperforming the Dow in the last week or two as big tech has been taking a breather. The energy sector is the number one performer in 2021. Global demand has grown as the COVID-19 vaccine rollout has picked up speed recently and we get closer to a fully reopened economy. Financials also had a strong week last week, returning over 2%, bringing the sector’s year to date return to a solid 9.8%. Financials have been beneficiaries of both strong equity and credit markets along with rising interest rates and a steepening of the yield curve. In addition, as the economy rebounds, the financial sector should feel some of those tailwinds.

One major factor influencing markets recently is fourth quarter earnings season. With more than 80% of the S&P 500 Index constituents having reported results, the Index’s earnings growth for the fourth quarter 2020 is tracking to a more than 3% year-over-year increase. This is roughly 12 percentage points above estimates set on January 1, 2021. The sectors seeing the biggest upside surprises include communication services, consumer discretionary and financials. Forward 12 months’ estimates have impressively increased about 4% year to date since earnings season began.

Another positive note is based on the Citi Economic Surprise Indexes. Economic data over the last three months in the major developed economies has, for the most part, exceeded expectations. The positive US reading at just over 50 – though down from summer 2000 highs of 200 – is impressive amid rising expectations. Even stronger readings in Europe as well as the United Kingdom suggest expectations may have finally been lowered enough to achieve. This being said, given LPL’s and Bloomberg’s consensus forecasts, economic growth in Europe is still expected to lag the United States this year.

In summary, the markets are rising from basic good news. Inflation and rising interest rates are a worry, but have yet to affect our markets significantly. We will keep a watch on these factors. Please remember to make your appointments with me soon.  – Mark

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. No strategy assures success or protects against loss. Economic forecasts may not develop as predicted. Some of this research material has been prepared by LPL Financial. All indices are unmanaged and may not be invested into directly. Referenced material: LPL Research Weekly Market Performance dated, 2/19/21.  Approved Tracking #:  1-05113683 & 1-05115497.