Data Points
- The U.S. economy added 225,000 jobs in January
- The ISM Manufacturing Index rose to 50.9, its first expansionary reading since July 2019
- The price of Brent crude oil slumped below $50 a barrel for the first time in over a year
Top Three Market Headlines
Jobs Report Beats Expectations: The U.S. employment market kicked off 2020 with a bang, according a report last Friday by the Labor Department indicating that U.S. employers added 225,000 employees to their payrolls in January. The total beat by a wide margin economists’ expectations of a 158,000 increase. Industries showing strong jobs growth included health services, transport, and construction; however, manufacturing employment fell for the third time in four months. The jobless rate ticked up slightly from its 50-year low of 3.5% to 3.6%, while wages rose 3.1% from a year earlier, consistent with recent trends.
Manufacturing Sector Rebounds in January: The Institute for Supply Management (ISM) announced last week that its Manufacturing Purchasing Managers’ Index (PMI), which is based on surveys of business executives, rose to 50.9 in January. This was up from 47.2 in December and above economists’ expectations of 48.5, and was the first reading in six months that topped 50, which is the threshold that distinguishes expansion in the sector (above 50) from contraction (below 50). Meanwhile, the U.S. services sector grew for the 120th consecutive month, as the ISM’s Non-Manufacturing Index climbed to 55.5 in January, up from 54.9 in December.
Oil Price Drop Spurs OPEC to Action: Brent crude oil, the international oil price benchmark, fell below $50 per barrel last week for the first time in over a year amid fears the coronavirus outbreak will curb demand for the energy commodity. A mid-week report in the Financial Times indicated that oil consumption by China – the world’s leading oil importer – could fall by 25% in February, as many businesses have suspended operations as part of efforts to control the spread of the virus. The sinking price of oil led OPEC and other oil-producing nations to hold discussions about enacting supplementary production cuts to support prices. An agreement came together late in the week when Russia, which earlier had opposed taking action, backed a recommendation for the combined countries to cut an additional 600,000 barrels of crude output per day.
|
As of February 7, 2020 |
Week |
Quarter-To-Date |
Year-To-Date |
One-Year |
|
MSCI All Country World |
2.69% |
1.56% |
1.56% |
19.33% |
|
S&P 500 |
3.21% |
3.17% |
3.17% |
25.45% |
|
Russell 2000 |
2.67% |
-0.62% |
-0.62% |
11.64% |
|
MSCI EAFE |
1.86% |
-0.27% |
-0.27% |
14.71% |
|
MSCI Emerging Markets |
2.75% |
-2.04% |
-2.04% |
7.47% |
|
FTSE NAREIT |
1.60% |
2.82% |
2.82% |
14.70% |
|
Bloomberg Commodity |
-0.08% |
-7.43% |
-7.43% |
-4.69% |
|
Barclays U.S. Aggregate |
-0.07% |
1.86% |
1.86% |
9.54% |
DOL 2/7/20, WSJ 2/7/20, CNBC 2/3/20, Reuters 2/6/20, 2/7/20, WSJ 2/3/20, ISM 2/5/20. Data from Morningstar Direct. Returns for periods greater than one year are annualized. Investment advisory, named and independent fiduciary services are offered through Gallagher Fiduciary Advisors, LLC, an SEC Registered Investment Adviser. Gallagher Fiduciary Advisors, LLC does not express an investment opinion regarding any specific commodity, sector or individual security. Unless otherwise expressly noted, the contents of this communication do not constitute securities or investment advice, nor should this communication be construed as an opinion regarding the appropriateness of any investment. Gallagher Fiduciary Advisors, LLC is a single-member, limited-liability company, with Gallagher Benefit Services, Inc. as its single member. Neither Arthur J. Gallagher & Co., Gallagher Fiduciary Advisors, LLC nor their affiliates provide accounting, legal or tax advice. The information provided cannot take into account all the various factors that may affect your particular situation, therefore you should consult your Gallagher Fiduciary Advisors consultant before acting upon any information or recommendation contained herein to discuss the suitability of the information/recommendation for your specific situation.