→ Written by Emiere Scaife, Capitalwize Chief Investment Officer

Questions about the possibility of raising interest rates have continued to be of high concern for retail and institutional investors alike. Fed rates have been steadily rising since the beginning of 2021. Starting the year at 0.96% and running up to a current yield of 1.56% as of the close of March 5, 2021 yields are still fairly low considering the fact over the previous 10 years rates have typically ranged between 2.5% and 4.0%. This increase in yields coupled with the once looming stimulus package from the Biden administration has stalled the strong bullish momentum of some of investor’s favorite sectors including Information Technology, Consumer Staples and Consumer Discretionaries.

Optimism grows as the future of COVID-19 becomes more predictable. With the approval of Johnson & Johnson one shot vaccine and the continual progress made by other vaccine producer experts anticipate a “return to normal” as early as this summer. Nearly 20 states have already lifted the mask requirement mandates while other states continue to loosen their restrictions. President Biden stated that by May the U.S. should have approximately 400 million doses of the vaccine available. Biden’s Chief Medical Advisor Dr. Fauci anticipates it taking until the end of summer to actually get all citizens vaccinated.

All in all, the S&P 500 continues to trend along as it does historically, up 2.29% year to date as of March 5, 2021. Investors should not be concerned about market noise and pull backs, as this is considered normal and expected behaviors for equities. As investors, we are here for the long haul so we encourage our clients to hold on during tumultuous market times as seen in the late weeks of February 2021 and the first week of March. Remember to continue following the plan provided to you by our excellent advisors here at Capitalwize.