First Quarter 2021 Review

2020 was a remarkable year everyone will remember in different ways, but mostly for its challenges, hardships, and persistent uncertainties. We’re looking forward to the new year.

In thinking about the events and market performance over the last year, a November Bloomberg article identified a key investment takeaway: “Views that seemed logical on their face – that the election would sow pain, that a recession would kill the rally, that the pandemic would ruin the economy – immediately became money losers.” Indeed, while the media swarmed us with negative stories, the stock market kept marching higher and higher. For investors, it was important to tune out the noise in 2020.  

The S&P 500 index priced-in the pandemic-fueled recession in record time, but it also rallied sharply off the bottom in given hyper-accommodative monetary policy, massive fiscal spending, and anticipation of a strong growth rebound sometime in 2021. In spite of all the challenges 2020 presented, U.S. stocks rose +18.4% for the year.