Julia Daly ’24 and Risk Analyst Shaan Shuster ’23 presented this week’s market update. They started things off with some information on Jerome Powell and the Fed’s recent activity. Powell recently stated that the Fed has no plan to raise interest rates and that the Fed is “committed to using our full range of tools to support the economy and to help ensure that the recovery from this difficult period will be as robust as possible.” However, Powell also told the Senate Banking Committee that “the economy is a long way from our employment and inflation goals, and it is likely to take some time for substantial further progress to be achieved.”
The U.S. Vaccine rollout continues as Johnson & Johnson has released their new single-dose COVID shot. The introduction of a 3rd vaccine to the market could mean surplus doses for the U.S. by July. Julia and Shaan also updated the club on the latest U.S. unemployment claim numbers. While unemployment has dropped significantly, it has still nearly doubled from what it was a year ago in February 2020.
Industrial Sector Analyst Ian Lee ’22 provided a sector update and highlighted the top-performing industrial positions in our portfolio. Boeing reported FY Revenue of $58.2B compared to $76.6B in 2019. The big news involving Boeing occurred last week when a Boeing 777 had engine failure just after takeoff. The engine caught fire and parts of the plane landed throughout a Denver suburb. A Dutch Boeing flight also experienced engine failure on the same day. These engines were both Pratt & Whitney engines, and Boeing has recommended grounding all 777 jets with these engines. How did this news affect the stock? Boeing shares fell 5% over the span of Monday and Tuesday, and Boeing is now facing a $6.6m fine from the FAA. Some other highlights of our Industrial sector include Caterpillar ($2.12 EPS vs. $2.71 in Q4 2019), Union Pacific (Q4 $2.36 EPS, up 17% YoY), and American Water Works ($3.91 FY EPS vs. $3.43 in FY19). Ian also suggested that we have the opportunity to potentially further diversify the sector with airline stocks or a position in the JETS ETF.
Congratulations to our new Healthcare sector analyst Kate Whittier ’21 and ESG Analyst Nick Tufano ’23!