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Weekly Market Update for December 31, 2020

by Jim Ulland

Stocks ended the year with a positive week, perhaps signaling the trend for 2021. Fixed income also was positive as interest rates stayed within a narrow range. We were delighted to produce strong performance this year in our equity strategies as well as very highly ranked performance in our fixed income strategy Intelligent fixed Income (IFI). During the week we welcomed our first bank and our first insurance company as clients. Neither could find satisfactory returns in traditional fixed income choices, so they came to us.

Monday produced new highs in the market, although the year closed slightly below these levels. The market had a hopeful feel as the latest stimulus bill was passed and Covid vaccinations started in earnest. Each state is responsible for the actual administration of the vaccination program and some were better organized than others. Also, the states will determine the order of vaccination, obviously starting with healthcare workers as well as nursing home and assisted living residents and staff. Late in the week, the UK approved the vaccine from AstraZeneca/Oxford. US approval should follow in the first quarter. Johnson and Johnson’s vaccine trial results are expected in January. The prospect of a vaccinated public has given investors confidence to commit cash to both stocks and fixed income.

Economic news turned positive led by falling unemployment filings which were the lowest in a month. Those already on unemployment (Continuing Claims) also fell. Some states were relaxing their lockdown policies as new Covid case numbers declined along with deaths. Lockdowns have been responsible for most of the job losses. Manufacturing had another positive week as shown by the Chicago Producers Manufacturing Index. Business sentiment reached the highest since Q4 2018. China also released solid economic numbers and seems to be out from under the Covid burden.

For the week, the Nasdaq was up +0.65%. The SP 500 was +1.43%. On Monday, the SP 500 was +0.87%, Tuesday -0.22%, Wednesday +0.13%, Thursday +0.64%, and Friday is New Year’s Day.

Next week is unusually important in that the US Senate runoff elections in Georgia will determine government tax and spending policies for the next two years. A reversal of the corporate income tax cut would be reflected in stock prices. Stay tuned for election results which may not be available on election night 1/5/21. But, by the end of the week, the results should be clear.

2021 is setting up for more economic recovery as lockdowns are lifted, jobs are restored, and uncertainty is reduced. We continue to see value in both equities and fixed income and encourage those with cash on the sidelines to put it to work. Finally, our year-end assets under management have set a record, for which we thank our clients. We hope to continue to earn your trust in the New Year.

The information contained in this commentary is not investment advice for any person. It is presented only for informational purposes to assist in explaining factors that may have had an impact in the past or may have an impact in the future on client portfolios or composites. All expressions of opinion reflect the judgment of the firm on this date and are subject to change. Included information has been obtained from sources considered reliable, but we do not guarantee that the foregoing materials are accurate or complete. Investors should contact Ulland Investment Advisors for individualized information prior to deciding to participate in any portfolio or making any investment decision. Ulland Investment Advisors does not provide tax advice. All investors are strongly urged to consult with their tax advisors regarding any potential investment.

Performance quoted is past performance. Past performance is not indicative of future performance. There is always a possibility of loss. Current performance may be lower or higher than performance shown. Differences in performance versus the indices/funds may be attributable, in part, to differences in the asset make-up of the strategy vs. the indices/funds. Performance calculations are based on the reinvestment of dividends and gains unless these amounts were paid out to the client. Performance is subject to revision. See for important strategy disclosures.

This does not constitute a recommendation of any investment strategy or product for a particular investor. Investing involves risk; principal loss is possible. Investors should consider the investment objectives, risk, charges, and expenses of the strategy carefully before investing. This and other important information can be obtained by contacting Ulland Investment Advisors.


Ulland Investment Advisors

4550 IDS Center · Eighty South Eighth Street · Minneapolis MN 55402 · Telephone: 612-312-1400 · Facsimile: 612-204-3464