Equity markets climbed higher as positive economic results from consumption to employment continued to fuel economic growth expectations for 2021. Large cap names rallied 1.20%. Earnings season wound down as 489 of the S&P 500 names have reported quarterly results. According to Bloomberg, those 489 names averaged a 23.08% earnings surprise and 3.93% sales surprised compared to analyst estimates. Last quarter there was a 15.5% earnings surprise and a 2.57% sales surprise compared to estimates. That is a sizeable jump in quarterly results compared to Wall Street expectations.
Treasury yields dropped mildly over the course of the week despite the Federal Reserve’s discussion of tapering asset purchases and the Biden administration’s $6 trillion budget proposal. Even though the Fed is expected to pare back the $120 billion a month bond buying program, investors have read many of the comments from the Fed as dovish. On Thursday, yields rebounded on renewed inflations concerns as the Biden administration proposed a $6 trillion budget for fiscal year 2022, which would be the highest sustained level of spending since World War II, adjusted for inflation.
