The S&P 500 touched record highs last week as stocks finished up by almost 1%. Smaller market cap names in the Russell 2000 outperformed their larger cap peers by besting the group with a 2.3% return. Asset prices across multiple classes also rallied last week. Oil surpassed its 2020 high closing at almost $60 per barrel. Bitcoin also continues to climb as the cryptocurrency surpassed $47,000 with corporate players such a Tesla and Mastercard embracing the emerging mainstream appeal. Optimism backed by a fresh round of stimulus and a boosted vaccine rollout has market participants looking for these catalysts to manifest into more positive returns for stocks. Impeachment proceedings in the Senate took shape as both sides aired their cases with help from powerful videos taken from during the presidential campaigns. An acquittal of the former President was the most likely outcome as 17 Republicans must join their Democrat and independent colleagues to convict President Trump. On Saturday, after a vote to consider possible witnesses in the trial, the Senate acquitted the former President with a 57-43 vote. The quick end to the trial allows Democrats to move forward on their legislative agenda.
Treasury yields moved slightly higher last week, while the 30-year Treasury yielded more than 2% for the first time since February 2020. The moves higher came as the market continues to price in the prospect of more government stimulus and higher economic growth as COVID-19 vaccines rollout. Inflation expectations also moved higher as the 10-year breakeven rate, or the difference between the yield on a nominal bond and one indexed to inflation, reached its highest level since 2014 last week.