Omicron News Boosts Stocks

December 13, 2021

A more benign reassessment of the possible economic risk posed by Omicron sent stocks sharply higher last week.

The Dow Jones Industrial Average picked up 4.02%, while the Standard & Poor’s 500 advanced 3.82%. The Nasdaq Composite index gained 3.61% for the week. The MSCI EAFE index, which tracks developed overseas stock markets, rose 2.74%.^1,2,3

Assessing Omicron

Though much is still unknown about the Omicron variant, reports of potentially milder health effects and the efficacy of booster shots ignited optimism that its economic impact would be less severe than originally feared.

Stocks rallied higher each of the first three days, with strong gains in many of the reopening stocks, such as airlines, travel and leisure, financials, and energy. The performance of high-valuation growth companies was a bit more erratic as they rose and fell sharply throughout much of the week. Weakening Thursday, stocks turned higher on Friday despite a hot inflation number, pushing the S&P 500 to a new record high.⁴

Inflation Factor

November’s Consumer Price Index (CPI) came in at a nearly 40-year high, rising 0.8% from the previous month and 6.8% from a year ago. It is the 6th-consecutive month that inflation has exceeded 5%. Core inflation (excluding the more volatile food and energy prices) came in lower, but still posted its sharpest jump since 1991.⁵

Economists have attributed this elevated inflation rate to strong consumer demand, a shortage of goods due to supply chain constraints, and strong wage growth. How long this high level of inflation persists is unknown, but the Fed has begun considering policy steps to manage it.

This Week: Key Economic Data

Wednesday: Retail Sales. FOMC (Federal Open Market Committee) Announcement.

Thursday: Jobless Claims. Housing Starts. Industrial Production. PMI (Purchasing Managers’ Index) Composite Flash.

^{Source: Econoday, December 10, 2021
The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.}

This Week: Companies Reporting Earnings

Thursday: Adobe, Inc. (ADBE), FedEx Corporation (FDX), Lennar Corporation (LEN).

Friday: Darden Restaurants, Inc. (DRI).

^{Source: Zacks, December 10, 2021
Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.}

Wealth Watch: NYSE Interview with Vance Howard

Hear from Vance Howard, CEO and Portfolio Manager at Howard Capital Management, about the HCM-BuyLine® and their two ETFs QQH and LGH on this episode of #TheExchange.[Watch Full Interview]⁸ 

^{This communication is issued by Howard Capital Management, Inc. It is for informational purposes and is not an official confirmation of terms. It is not guaranteed as to accuracy, nor is it a complete statement of the financial products or markets referred to. Opinions expressed are subject to change without notice.} 

Tax Incentives Can Help You Further Your Education

Tax credits help with the cost of higher education by reducing the amount of income tax you may need to pay. The two tax credits available are the American Opportunity Tax Credit and the Lifetime Learning Credit.

Some education savings plans offer tax benefits if the individual qualifies. Also, you may be able to deduct higher-education costs – such as tuition, student loan interest, and qualified education expenses – from your tax return.

If you’ve always dreamed about going back to school, whether to further your career or just to learn something new, knowing your potential tax benefits may save you money. ⁶

^{* This information is not intended to be a substitute for specific, individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax professional.}

The Benefits of Brain Training

We know how important it is to exercise our bodies, but exercising our brains is just as important. When we continue to learn, our brains are better for it. Here are just a few benefits from “brain training,” or exercising your brain:

• Improved executive functions
  
  
• Improved working memory
  
  
• Improved processing speed
  
  
• Preserved cognitive health
  
  
• Fewer problems with daily functioning
  
  
• Better control over mental processing abilities

There are lots of fun ways to exercise your brain, one of which is to continue to learn new things. Attend a pottery, painting, or foreign language class in your neighborhood, or check for any discounts on community college courses. Another great way to exercise your brain is to socialize with others, spend time in nature, and practice mind puzzles, such as crosswords, Sudoku, or a game in a brain-training app.⁷

Cheesy Broccoli Kale Pesto Pizza

Servings: 3

Time: 25 minutes

Ingredients 

• 3 fluffy flatbreads: naan or pita
• 1.5 TBSP olive oil
• 2 tsp minced garlic
• salt and pepper to taste
• 2 cups of broccoli florets (6-8 ounces)
• 1-2 cups chopped kale
• 2-3 TBSP pesto (homemade or store bought)
• 3/4 cup mozzarella cheese
• 1/2 cup cheddar, fontina, gouda, or gruyere cheese
• 1/4 cup parmesan cheese
• 1/8 tsp crushed red pepper flakes for topping (optional)

Directions

1. Preheat oven to 350 degrees F.
2. Arrange flatbread on a foil lined baking sheet.
3. Combine olive oil and minced garlic, spread evenly on each.
4. Bake 8 minutes.
5. While your flatbread bakes, fill a pot or skillet with 1 cup of water and bring to a boil. Quickly blanch your kale and broccoli for 1 minute. Drain and remove from heat. (You can also sauté them in a little butter or oil if preferred over blanching!) Season with salt and pepper as desired.
6. Once flatbread are ready, spread generously with pesto and top with a little bit of the cheese. Add your veggies and remaining cheese on top.
7. Bake for an additional 10-12 minutes, or until perfectly hot and melty.
8. Top with crushed red pepper flakes (optional + spicy!) or an additional sprinkle of parmesan cheese if desired. Crumbled feta also makes a tasty topper! Dive in and enjoy! ⁹

Stay safe!

Footnotes and Sources

^{1. The Wall Street Journal, December 10, 2021}

^{2. The Wall Street Journal, December 10, 2021}

^{3. The Wall Street Journal, December 10, 2021}

^{4. CNBC, December 10, 2021}

^{5. The Wall Street Journal, December 10, 2021}

^{6. IRS.gov, June 16, 2021}

^{7. American Psychological Association, June 24, 2021}

^{8. howardcm.com, December 8, 2021}

^{9. peasandcrayons.com, June 8, 2017}

^{Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost.}

^{The forecasts or forward-looking statements are based on assumptions, may not materialize, and are subject to revision without notice.}

^{This content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. Please consult legal or tax professionals for specific information regarding your individual situation. This material was developed and produced by FMG Suite to provide information on a topic that may be of interest. FMG is not affiliated with the named representative, financial professional, Registered Investment Advisor, Broker-Dealer, nor state- or SEC-registered investment advisory firm. The opinions expressed and material provided are for general information, and they should not be considered a solicitation for the purchase or sale of any security.}

^{Copyright 2021 FMG Suite.}

McCarthy Financial Group's Blog: Market Insights & Wealth Watch