The Federal Reserve’s in a tricky spot this week, committed to dovish monetary policy as the economy roars back from the coronavirus pandemic.
The S&P 500 plunged 3.3 percent between Friday, January 22, and Friday, January 29. It was the biggest weekly decline since October, with 85 percent of the index’s members losing value. The selloff also dragged stocks into negative territory on a year-to-date basis.
ADP’s private-sector payrolls report on Wednesday and the Labor Department’s non-farms payrolls report on Friday both missed estimates. They were also negative — showing actual job losses — for the first time in at least six months.
Yesterday the Institute for Supply Management’s manufacturing index spiked to its highest level in more than two years as new orders surged. That was a big improvement from the previous month, when coronavirus safety measures delayed work and kept employees at home.
The S&P 500 rose 1.7 percent between Friday, November 27, and Friday, December 4. It was the index’s fourth gain in the last five weeks. Other key benchmarks including the Dow Jones Industrial Average, Nasdaq-100, Russell 2000 and Dow Jones Transportation Average also closed at record highs.