The S&P/ASX 200 (ASX: XJO) finished the week in the green, closing Friday’s session 0.1% higher to take the weekly gain to 1%.
For all the latest, see Rask Media’s daily ASX 200 report.
As we head into a new week, here are my three key investor takeaways from the week just gone.
Consumer recovery underappreciated
In an environment where property prices and sharemarkets are hitting record highs every other day, it can be difficult to maintain a level head, regularly oscillating between bearish and bullish positions.
It was during a meeting this week, however, that I was reminded of the sheer power that lies behind the global consumer, representing as much as 70% of the US economy.
News that retail sales had hit 18%, combined with the fact that many parts of the country are still under heavy restrictions, suggest that there remains a strong tailwind ahead, particularly if jobs growth remains strong.
For investors though, the important step will be finding those companies that aren’t already pricing in significant growth.
Times are good for bankers
The US investment banks led reporting season this week, the likes of Goldman Sachs (NYSE: GS), JP Morgan (NYSE: JPM) and Morgan Stanley (NYSE: MS) delivering incredible billion-dollar profits as trading and corporate activity hits rarely-seen levels.
The conditions couldn’t be better for bankers and their bonuses, with access to cheap capital, plenty of companies in need of it and investors being forced through negative real interest rates to take more risk – they face the perfect storm of demand.
Virus remains a real risk
Finishing on a negative tone, it has become clear that the coronavirus remains a real risk to the recovery.
Despite Australia’s near-normal conditions, many parts of the world are still facing massive death tolls and case counts, with Australia protected only by our international border.
Looking ahead, the ASX 200 is tipped to push higher when the market opens on Monday, with the latest ASX futures indicating a 0.5% rise.