Week in Review: November 19, 2021

Equity markets (S&P 500) bounced around in search of direction, finding little. With earnings season now largely over, investors focused on economic data, growing concerns about new COVID-19 cases, and who the White House will nominate to lead the Federal Reserve. In addition, the House of Representatives passed President Biden’s $1.75T social spending bill, sending it to the Senate for debate. Curiously missing from the headlines were the rapidly approaching deadlines for Congress to pass a longer-term government funding bill and raise the debt limit, both of which will expire in early December.

In Europe, Austria announced a new national lock down in an effort to contain surging COVID cases. In addition, the country mandated that all citizens be vaccinated by February 1, 2022. Facing a similar surge in cases, Germany’s Health Minister didn’t rule out a similar lockdown. In the U.S,, after leveling off in late October, new COVID cases are once again rising, creating renewed concerns about the potential economic impact. Reflecting those concerns and news that the U.S. had asked Japan, India, and China to join a coordinated effort to release oil from strategic reserves, oil settled at a seven-week low.

Once widely considered a shoo-in, there is now growing intrigue as to whether Jerome Powell will be renomintated to lead the Federal Reserve. Also under consideration is current Federal Reserve Governor Lael Brainard. The general consensus is that Brainard is more “dovish” than Powell, something to consider given the scrutiny the Fed is currently receiving regarding inflation.