With investors taking note of improving COVID-19 trends, an expanding US economy, and additional fiscal stimulus expected in the coming weeks, many are wondering if market sentiment is getting ahead of itself, and the stock market has certainly been on a tear recently. Since the presidential election on November 3, 2020, the S&P 500 Index is up over 15% on a total return basis as of February 23, and has climbed back over 76% since the market bottom on March 23, 2020.

As shown in the LPL Chart of the Day, despite some inklings of volatility this week, the American Association of Individual Investors survey of bulls versus bear

In our recent Market Signals video, LPL Financial Chief Market Strategist Ryan Detrick and Equity Strategist Jeff Buchbinder are joined by guest speaker Jason Hoody, Head of Investment Manager Research, to discuss investments made with the intention of generating positive environmental, social, and governance (ESG) impact along with a financial return. 2020 sustainable performance was very impressive and trends may be in the beginning of a bright future for this type of investing. Key topics include:

• ESG investing

• Rising rates & impact on markets

• Earnings season

• Retail sales

Leading economic indicators are providing early signs that we may be exiting a recent soft patch and the economic recovery could be poised for a reacceleration.

On Monday, February 22, the Conference Board released its January 2021 report detailing the latest reading for its Leading Economic Index (LEI), a composite of ten data series that tend to lead changes in economic activity. Many economic data points are backward looking, but we like the LEI, as it has a forward looking tilt to it. The index grew for the ninth month in a row, up 0.5% month over month in January, a slight increase from December’s 0.4% pace. Incredibly

Treasury yields started moving sharply higher this past month (remember that as yields go up, prices go down). And while the upward march began in earnest last August when the 10-Year Treasury yield bottomed at an all-time low rate of 0.50% based on closing prices, the past week we saw the 10-year break through the 1.25% threshold and touch 1.35%, a new high for the year. So naturally, investors are right to ask two questions: 1) How does this recent move up in yields compare to previous recoveries and 2) what should be expected for the rest of the year?

“We believe more good news on the economy will continue to push yields