The Week In Review


The S&P 500 gained 0.6% on Friday in a broad-based rally while U.S.-China trade talks showed signs of progress. The benchmark index also increased 0.6% this week.

The Dow Jones Industrial Average (+0.7%), the Nasdaq Composite (+0.9%), and the Russell 2000 (+0.9%) extended their weekly gains to 0.6%, 0.7%, and 1.3%, respectively.

Nine of the 11 S&P 500 sectors finished higher with information technology (+1.3%), communication services (+1.1%), and health care (+0.9%) leading the advance. Conversely, the financials (-0.2%) and consumer staples (-0.3%) sectors finished in the red.

Stocks traded for most of the session with modest gains, as technology stocks led the advance. Stocks, however, came off their session highs in late afternoon trading following some U.S.-China trade updates.

The Chinese delegation will stay in Washington an extra two days to continue negotiating, but the two sides have reportedly agreed on two things: (1) an unspecified agreement regarding currency manipulation and (2) a commitment from China to purchase $1.2 trillion of U.S. goods. President Trump said he will likely meet with China's President Xi at Mar-a-Lago in March.

The market climbed right back to where it was before the trade news, finishing near its best levels of the day.

Separately, remarks from Federal Reserve officials on Friday provided little surprises and were not market-moving. The Fed speakers maintained a dovish-minded stance on the central bank's monetary policy and balance sheet normalization efforts.

Kraft Heinz (KHC 34.95, -13.23) was a story stock, plunging 27.5%, after the company missed earnings expectations, slashed its dividend, and announced that it has received a subpoena from the SEC, inquiring about the company's accounting practices.

U.S. Treasuries closed on a higher note, pushing yields lower across the curve. The 2-yr yield decreased five basis points to 2.48%, and the 10-yr yield decreased three basis points to 2.66%. The U.S. Dollar Index declined 0.1% to 96.55. WTI crude rose 0.5% to $57.25/bbl.

Investors did not receive any economic data on Friday.

Looking ahead, investors will receive Wholesale Inventories for December on Monday. In addition, Warren Buffet will release his widely-read annual letter Saturday morning, along with Berkshire Hathaway's earnings report.

  • Russell 2000 +17.9% YTD
  • Nasdaq Composite +13.5% YTD
  • Dow Jones Industrial Average +11.6% YTD
  • S&P 500 +11.4% YTD
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