The Financial Quarterly

4th Quarter 2021

Kevin Murray
https://murrayfinancialservices.com
Murray Financial Services
(530)896-5484

Markets delivered exceptional performance in a year that had a little bit of everything: politics, bubbles, meme stocks, inflation, runaway rallies, and sudden drops. Let's take a look at how markets performed last year and what we might look forward to in the first months of 2022.

Looking Back

How Did Markets Perform Last Year?

S&P 500

The broader U.S. market soared in 2021, despite worries about inflation and variants.1

NASDAQ

The tech-focused NASDAQ delivered a strong year on a new technology boom.1

DOW 30

Blue chip stocks grew strongly in 2021 on solid corporate earnings.1

Looking Ahead

What Can We Expect 3-9 Months Ahead?3

U.S. Economic Outlook

Negative Positive

The U.S. economy is positioned for continued growth in 2022, but the pace of the recovery may slow as the easy gains are likely behind us.2

Equity Outlook

Negative Positive

Stocks look to still have room to grow this quarter, but obstacles could lead to plenty of volatility and potentially even a correction.3

Consumer Spending

Negative Positive

Consumer spending looks positive as Americans look to keep shopping in 2022.4

Labor Market

Negative Positive

The labor market is expected to remain strong, though labor shortages in certain sectors could lead to uneven growth.5

Business Outlook Survey

Negative Positive

The business environment looks solid as workers return and consumers spend, though inflation and supply chain issues may weigh.6

Fiscal Policy

Negative Positive

Fiscal policy is expected to tighten in 2022 as pandemic supports are removed, though infrastructure spending may support medium-term growth.7

"While pandemic disruptions remain, 2022 offers hopes of greater normalcy."

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Bottom Line

Key Takeaways for Savvy Investors

Despite another year of uncertainty around COVID-19 variants, vaccines, and the economy, markets delivered an extraordinary performance in 2021. Looking back, while it's easy to cheer a strong year, let's not forget that there were many dips, pullbacks, and anxious moments along the way.

That's just part of the journey.

What can we look forward to in 2022?

Signs point to continued growth amid hope that variants will become less dangerous as treatments advance and humans (and our institutions) adapt.

However, much of the "easy" recovery from the pandemic bottom is behind us and inflation, supply chain snarls, and labor market shortages remain thorny issues.

Given the market highs we’ve seen recently, volatility and pullbacks are very likely.

Overall, I'm cautiously optimistic about this quarter’s trajectory. However, I'm also keeping a close eye on market conditions, as continued uncertainty could drive sudden changes.

Questions? Please reach out. I'd be happy to chat.

Kevin Murray
Murray Financial Services
(530)896-5484
kmurray@murrayfinancialservices.com