This Weekly Market Update reviews the top market headlines: Hiring Rebounds in February, U.S. Business Expansion Continues, Oil Prices Push Higher on Extended Production Cuts

Top Three Market Headlines 

Hiring Rebounds in February: The Labor Department reported last week that U.S. nonfarm payrolls increased by 379,000 in February, marking the second straight month of job growth. Most of the gains in February occurred in the leisure and hospitality industry across businesses such as restaurants, hotels, and amusements, as economic restrictions in parts of the country were relaxed amid lower COVID-19 case rates and increasing vaccinations. Meanwhile, the unemployment rate continued to tick down, falling to 6.2% in February; while this is well below the 14.8% peak registered in April of last year, it remains above the pre-pandemic rate of 3.5%.

U.S. Business Expansion Continues: The U.S. economy continued to expand in February, according to surveys of business executives released last week from the Institute of Supply Management (ISM). The ISM Manufacturing index registered 60.8 in February, up from 58.7 in the prior month and matching a three-year high. (A reading above 50 indicates expansion of activity while a sub-50 mark reflects contraction). The services sector also continued to grow in February, though at a slower pace, as the ISM Services Index came in at 55.3, which was 3.4 points lower than the prior month. Both indices have now exceeded 50 for nine consecutive months.

Oil Prices Push Higher on Extended Production Cuts: Oil prices jumped last week on news that OPEC+, the group of 24 oil-producing nations, will extend previously-negotiated production cuts until the end of April. The price of front-month West Texas Intermediate (WTI) crude oil futures contracts rose more than 7% on the week to settle at $66.09 per barrel, the highest level since November 2018. The latest surge added to oil’s gains this year, as the WTI futures price has risen 36% year-to-date. The production cuts orchestrated by OPEC+ have withheld a total of seven million barrels a day from the global market, or approximately 7% of global demand.

As of March 5, 2021 Week Quarter-To-Date Year-To-Date One-Year
MSCI All Country World 0.11% 1.96% 1.96% 27.13%
S&P 500 0.84% 2.57% 2.57% 29.30%
Russell 2000 -0.38% 11.15% 11.15% 50.14%
MSCI EAFE -0.49% 0.66% 0.66% 18.64%
MSCI Emerging Markets 0.05% 3.91% 3.91% 31.64%
FTSE NAREIT 0.03% 4.15% 4.15% -1.87%
Bloomberg Commodity 0.68% 10.01% 10.01% 18.28%
Barclays U.S. Aggregate -0.80% -2.93% -2.93% -0.26%

ISM 3/1/2021, WSJ 3/52021, MarketWatch 3/5/2021, Bloomberg 3/4/2021. 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.