The S&P 500 in December kept its upward momentum and rewarded investors with another solid rise of over 3% following the impressive gains it had in November The month was a bit choppy as the index stair-stepped higher while Congress continued to struggle with getting the much anticipated fiscal stimulus package passed. Importantly, Congress ultimately finalized the much-needed package despite the last minute uncertainty that arose when the President tried to push for a higher dollar amount in the stimulus checks.

There continues to be a back and forth between positive and negative news headlines; negative headlines being dominated by the new more contagious strain and dismal case numbers and positive headlines about the vaccine rollout and healthcare/economic progress. Thus, on a day to day basis, the equity market can appear volatile depending on what story is most dominant on a given day.

From our perspective, it is important for investors not to get paralyzed or overly bearish as a result and keep your eyes on the bigger picture that will impact your equity returns — the 2021 corporate profits recovery. There may be some bumpiness in equity prices during the first quarter of 2021, but the key indicators in our research process remain bullish and we are still suggesting that investors should view dips as buying opportunities.