Equities reversed a nine-day selloff with a strong week of buying. The S&P 500 finished up 4% to 2,164, nearing its all-time high set over the summer. Now that the U.S. Presidential Election is complete, investors have one less uncertainty to worry about, allowing them to add risk to their portfolios. Small-caps outperformed, up over 7% for the week. The 10-year US Treasury Yield jumped above 2.10%.
Given the change in leadership, traders and portfolio managers rotated out of Technology, Consumer Goods, and Utilities stocks and moved into Financials, Healthcare, Industrials, and Materials. Transports, for example, reached a new 52-week high, while the Biotech ETF (IBB) moved higher by 14%.
Earnings season is concluding with 85% of S&P 500 companies now reported. Sales growth for these companies was +2.5%, the highest since Q4 of 2014. Rockwell Automation (ROK) released solid results and guided in-line with analysts' expectations. State National (SNC) and NVIDIA (NVDA) both turned in big earnings beats and strong outlooks.
Next week, investors will be looking at Industrial Production, Retail Sales, and Inflation data.