John Hancock: Weekly Market Recap Week Ended February 8th

NASDAQ bull back?

The NASDAQ modestly outperformed the other major indexes for the week and at one point came close to entering a new bull market. At midweek, the index was up about 19% from a recent low reached in late December, when it entered a bear market. A rise of 20% from that recent low would put the NASDAQ back into bull territory.

Momentum shift

Stocks posted solid gains on Monday and Tuesday before pulling back on Thursday, leaving the S&P 500 and the Dow with tiny weekly gains. For the Dow, it was the seventh positive week in a row.

Earnings slump

While most companies in the S&P 500 have been reporting increases in fourth-quarter earnings, they’ve been issuing more cautious forecasts of the first-quarter numbers they’ll be reporting starting in April. According to FactSet, overall earnings are expected to decline 1.9% from the same quarter a year earlier. It would be the first such quarterly decline in nearly three years.

Volatility vacation

Although stock market volatility climbed as U.S. equities sold off on Thursday, the market ended the week much calmer than it had been in late December, when there was a surge in volatility. The Cboe Volatility Index, a gauge of investors’ expectations of near-term volatility, slipped on Friday to a level that was 55% below its recent peak on December 24.

Source: https://wmr.jhinvestments.com/