Week in Review: January 15, 2021

US equity markets had a volatile week as investors digested headlines of continued tensions in Washington, President-elect Biden’s $1.9T stimulus plan, and the start of earnings season. The S&P 500 flirted with new highs during the week before ending lower. Oil fell from its ten-month high and treasury yields retreated as investors rotated into the asset class, seeking refuge from potential equity market volatility heading into Inauguration week. On Wednesday, the House voted to impeach President Trump for a second time, though the Senate trial most likely will not begin before his term ends on January 20th.

President-elect Biden unveiled his $1.9T coronavirus spending package. If approved, among other measures, it will provide direct payments of $1,400 to millions of individuals, increase enhanced unemployment benefits from $300/week, to $400/week, raise the minimum wage to $15/hour, extend the federal eviction moratorium from January through September, and provide billions of dollars to state and local governments and schools.

The ongoing surge in new coronavirus cases showed little signs of slowing as cumulative cases in the US increased 1.56M for the seven day period ending Saturday, to a total of 23.8M, while deaths rose another 23.3K, to a total of 395.8K. On Friday, the CDC reported that a new, much more highly transmissible variant of the coronavirus, already detected in 10 states, could become the dominant strain in the U.S. by March. Through Friday, 11 million vaccine doses had been administered, though that figure represented only a third of what has been distributed to states so far.