January ended on a sour note for U.S. large cap stocks with the S&P 500 and Dow Jones Industrial Average both erasing gains for the year on concerns that the rapid spread of the coronavirus will slow global growth. The final week of the month was particularly brutal across world markets as a flurry of mostly better-than-expected earnings reports, central-bank decisions, and economic data was overshadowed by worries about the highly contagious epidemic. On Friday, January 31, the Nasdaq Composite fell 1.6% but closed out the month with a 2% gain. It was the first time since September 2018 that all three major U.S. equity indices failed to directionally move together on a monthly basis.
- Fixed-income assets outperformed equities in January as concerns about the fast-spreading coronavirus drove demand for safe-haven assets.
- U.S. stocks has their worst month since August, as the S&P 500 retreated over 3% from its most recent all-time high that was reached on January 17.
- For the month, the Dow Industrials gave back 282 points (-0.89%) while the tech-heavy Nasdaq Composite pared a stronger advance to finish January with a 2.03% gain.
U.S. crude oil plunged over 15% in January, ending at a six-month low of $51.56 per barrel. Oil slumped amid concerns over falling fuel and travel demand due to the spreading coronavirus. Airlines around the world are suspending flights to and from China.
The Monthly Recap is published by Cetera Investment Management LLC, an SEC registered adviser owned by Cetera Financial Group. Cetera Investment Management provides market perspectives, portfolio guidance, model management, and other investment advice to its affiliated broker-dealers, dually registered broker-dealers and registered investment advisers.
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