Overcoming a rocky start, stocks rallied into the close of a holiday-shortened week of trading as technology shares staged a powerful recovery and investors reacted positively to President Biden’s infrastructure spending proposal.
The Dow Jones Industrial Average gained 0.24%, while the Standard & Poor’s 500 picked up 1.14%. The tech-heavy Nasdaq Composite index rose 2.60%. The MSCI EAFE index, which tracks developed overseas stock markets, slipped 0.43%.1,2,3
S&P 500 Hits 4,000
Monday opened with two banks reporting they face losses due to the default of a small U.S. hedge fund. That news, combined with rising yields, higher new cases of COVID-19, and a public warning of new virus variants, started the week off on an unsettled note.4
Despite the shaky start, upbeat economic reports helped spark a rally that was paced by gains in the technology sector. The market also reacted positively on Wednesday to the introduction of a $1.9 trillion infrastructure proposal.
Stocks closed out the week with an exclamation mark, with the S&P 500 Index closing above 4,000 for the first time.5
Hedge Fund Woes
Last week’s trading opened on news that a U.S.-based investor was forced to unwind positions in multiple Chinese technology companies and American media holdings.
A number of large banks saw their share prices fall early in the week, reflecting concerns about their exposure to the hedge fund losses. Meanwhile, investors grappled with whether this was a one-off event or the opening act for additional hedge fund issues. As the week wore on, it appeared the hedge-fund issues were an isolated event.4
On another note, the tax filing deadline has been pushed back to May 17th, 2021. So you still have time until May 17th to contribute to your IRA's for 2020 and possibly save some taxes.
Have a great week!
Trish and Sean
Saguaro cactus at sunset in the Superstition Mountains, Phoenix, Arizona.
Footnotes and Sources
2. The Wall Street Journal, April 1, 2021
3. The Wall Street Journal, April 1, 2021
4. Fortune.com, March 29, 2021
5. CNBC, April 1, 2021
6. IRS.gov, February 2, 2021
7. Batonrougeclinic.com, August 28, 2019
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Weekly Market Insights: S&P 500 Rises Above 4,000
| April 05, 2021