John Hancock: Weekly Market Recap Week Ended February 11th

Earnings surprises

With the earnings season now mostly behind us, the proportion of S&P 500 companies that had beaten analysts’ net income expectations stood at 77% as of Friday, according to FactSet. That so-called beat rate ranks slightly above the 76% five-year average. Across sectors, information technology had the highest beat rate at 87%; utilities had the lowest at 56%.

Inflation’s relentless rise

Prices of stocks and bonds fell on Thursday after the government reported that inflation accelerated at a 7.5% annual rate in January—the highest since 1982. That figure was above December’s 7.0% increase and well above the 1.8% annual rate for inflation in 2019, prior to the pandemic.

Energy’s resilience

As it was for full-year 2021, energy has been the top-performing S&P 500 sector of early 2022—and by a wide margin, with a 27% year-to-date return as of Friday. Rising oil prices have been a key reason for energy’s recent market leadership.

Shopping snapshot

A government report scheduled to be released on Wednesday will show whether U.S. retail sales recovered in January in the wake of the Omicron variant’s emergence at the peak of holiday shopping season. A month ago, the government reported that December retail sales fell 1.9%.

Source: https://wmr.jhinvestments.com/