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Daily Capital

November Market Recap: Stocks Bolstered by Vaccine News

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eading into November, investor sentiment was particularly dour related to election uncertainties and accelerating COVID-19 cases. However, the month proved to be one of the best ever for global equities. The election was not seamless but was less chaotic than feared. A divided government was immediately cheered by markets. Soon after, stocks received another significant boost from a string of extremely encouraging vaccine test results.

Investors Look Toward Post-Pandemic Economy

With the end of the pandemic seeming closer and more tangible, money flowed out of the so-called “stay at home” trade and into physical economy stocks. Small cap and international shares posted outsized returns. We believe economic restrictions from COVID-19 will likely be gone by the second half of 2021 but may intensify in the short term. How much behavioral change from the pandemic becomes permanent is impossible to know. The acceleration of the digitalization of the economy will not reverse, but that does not preclude sectors outside of tech and communications from outperforming. The world has changed, as have valuations and priced-in expectations across the equity markets.

Small and value stocks have now been leading highly priced growth issues since the end of August. The trend accelerated in November, but it would be premature to say the most popular and highly priced tech stocks will retreat or take a back seat for an extended period. Some parts of the market continue to look quite frothy, in our view, and we continue to believe style and regional diversification remain at elevated importance.

The content contained in this blog post is intended for general informational purposes only and is not meant to constitute legal, tax, accounting or investment advice. You should consult a qualified legal or tax professional regarding your specific situation. Keep in mind that investing involves risk. The value of your investment will fluctuate over time and you may gain or lose money.

Any reference to the advisory services refers to Personal Capital Advisors Corporation, a subsidiary of Personal Capital. Personal Capital Advisors Corporation is an investment adviser registered with the Securities and Exchange Commission (SEC). Registration does not imply a certain level of skill or training nor does it imply endorsement by the SEC.

Craig Birk leads the Personal Capital Advisors Investment Committee and serves as Chief Investment Officer. His focus is translating improvements in technology into better financial lives. Craig has been widely quoted in the Wall Street Journal, Bloomberg, CNN Money, the Washington Post and elsewhere. Prior to Personal Capital Advisors, he was a leader within the portfolio management team at Fisher Investments, helping assets under management grow from $1.5 billion to over $40 billion. Craig graduated from the University of California at San Diego and has earned the Certified Financial Planner® designation.
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