The Major Markets continued their run last week with an impressive gain in each of the major indices. The S&P 500 ended the week on the high tick of the day and week with a new all-time high at 2872.87. This extends the YTD gains to 7.45% on the S&P 500.
The markets were able to shrug off the Government shutdown which only lasted three days and ended on Monday evening. However, the bill that was passed only provided short-term funding through February 8th.
Meanwhile, President Trump was in Davos, Switzerland for the World Economic Forum where he told the world that “America is open for business.” In a later interview with CNBC, he stated that
“The dollar is going to get stronger and stronger and ultimately, I want to see a strong dollar,”
This statement seemed to conflict with comments made the day prior by Treasury Secretary Steven Mnuchin who said that he welcomes a weakening of the dollar as it’s “good for trade.”
The president later stated that he thought Mnuchin’s comments were misinterpreted and take out of context.
Nonetheless, the U.S. Dollar Index fell sharply last week following Mnuchin’s comments, ending the week lower by 1.6% and at the lowest level in three years.
In economic news, the 4th quarter GDP came in lower than expected at 2.6%. However, consumer spending rose at 3.8%, beating expectations of a 3.6% increase and helped to fuel the runup for the close of the week.
This week marks the end of Janet Yellen’s tenure as Chair of the Federal Reserve with the last Federal Open Market Committee beginning on Tuesday. In her place, Jerome Powell will be taking over, beginning on Sunday.