Transcript
Hello, everybody, welcome to Wednesday, the S&P 500 was down about .8%. Today, and really it can be attributed to what happened with the stimulus talks, you know, the two driving forces are going to make this market go up and down right now are the news about the vaccine, and the, you know, information that’s happening about the stimulus talks. So, you know, for a few days here, we’ve had some good news, you know, yesterday, they had the first vaccines given out in the UK, that the markets seem to really respond positively to that.
And then of course, today, you know, there’s some negative news about the stimulus. I’ve said before, that the stimulus is going to come out most likely when there’s enough pain for both parties to come together. And so we saw that back in March, that’s for sure came very quickly. But we’re not seeing as much pain for quite a while here. But now we are starting to see that, you know, of course, the virus cases are growing dramatically. And so you know, the unemployment situation, the small businesses situation, so, you know, the stimulus, it probably needs to come out for a lot of these different groups. And it does seem like they’re getting closer and closer, but, you know, hasn’t happened yet. And so the market has been factoring in, you know, a probability of stimulus coming. And so we’ve seen some run up there. And now, you know, that probability drops back a little bit with today’s news. And so we start to see some negatives.
I think one of the interesting things about today is that technology and the advanced health care and the Clean Energy all kind of wore down and underperformed the market, and the two pieces that were up our Large Cap, you know, Value was up .9%, or Small Cap Value is up .5%. That’s actually pretty unusual. Usually, the stimulus seems to be the thing that might help those types of companies. And today, it was up even on that bad news. And one of the few things that was up, so there is a rotation going on towards these value pieces, even in the face of some news, at least in the short term that could be detrimental. Let’s just quickly take a look at you know, the chart here. So you can kind of put this in perspective for today. You know, this is the S&P 500 through Vanguard’s index, you know, we had the big drop, and this is one of the greatest recoveries in the history of the stock market, right.
And we’re still on track. I mean, if you look, the 20-day moving average is up the 50-day moving average is up the 200-day moving average is up. And if I zoom in, so we can just kind of see a little bit more of what happened today. You know, we’ve had a pretty good run up here, based on you know, the stimulus, the good vaccine news. And you know, we had a drop off here, as far as that goes today, still well, within range, nothing to be to, you know, dramatically concerned about as far as that goes, the trend is still up. Generally, when the trend is up, and you see drops, like we had in October or September, back in June. You know, they don’t always disappear in a day. But what they do is create the situation where more buying comes in, sort of like things going on sale, and people that felt like they missed out, start jumping in, and that creates that next upward leg, the next momentum as far as that goes.
So we have had a phenomenal run since the end of October to now. So it’s very likely we start to see some, you know, pull backs, and we get that, you know, next leg up because of those pull backs. So I think things are fine right now. And I think you know, this is part of the normal process. And again, we’ll kind of see how things play out. But let’s look forward to see what’s going to happen tomorrow and for the rest of this week. I will talk to you then. Thank you.