Is your Holiday Cup of Cheer half-full or half-empty?

Attention grabbing headlines in the media are often negative in tone and create tension and anxiety. Few headlines have focused on stock market returns in 2021 or over the past 10 years.

Concerning news headlines are nothing new
Some of the issues dominating the news recently are concerning. Inflation has spiked after the reopening of the economy. Shortages are being reported on everything from computer chips to Christmas gifts and covid variant concerns are once again dominating the news cycles. With these headlines, it would be easy to have a negative point of view of the economy, investments and the stock market in particular – the cup is half empty.

At Prato Capital, we like to use history as a guide when looking at current stock market conditions. The following 2 charts look at S&P 500 returns. Chart 1 below shows the returns of the S&P 500 with dividends reinvested this year along with some of the news events that have been in the media.

Chart 1: News Headlines and S&P 500 Growth During 2021

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