2021 is Off to a Fast Start!

Economic Update - written January 25th 2021

Ready… Set… Go!

The stock market’s first hurdle of the New Year was to assess the runoff elections happening for the two Senate seats in Georgia. A special election such as this has only happened a handful of other times in our nation’s history, so the market appeared anxious about the process.

The market’s second hurdle was the electoral college count that would confirm Joe Biden as the 46th president of the United States. A protest during the vote count unnerved investors, and most of the New Year’s rally was undone. However, just one day later the market climbed higher as traders looked past the unrest.

Stocks Scale New Heights

Midway into the 1st month of the new year stocks rallied. Testimony from incoming Treasury Secretary Janet Yellen raised hopes for a new round of federal spending when she suggested to the Senate Finance Committee that lawmakers should “act big” on fiscal stimulus.

An orderly presidential transition and the anticipation of a more effective vaccine distribution plan contributed to stocks touching multiple new highs this month. Investor enthusiasm was further supported by a strong start to the fourth-quarter earnings season.

What does this fast-paced market activity mean for investors?

There will always be a lot of noise. But remember, making a change to your portfolio should be driven by sound analysis and preparation. Reacting impulsively to market volatility can compromise the return of your portfolio and your overall financial plan. As Advisors we have come to expect the volatility that comes along with investing and have anticipated these trends as we developed your overall financial strategy.

If you have any questions about your personal financial situation, please reach out to a member of your Gilbert & Cook Abundance Team.