The S&P 500 gained more than 6% in the first quarter of 2021. Energy and financial services were some of the best performing sectors, rebounding strongly after a difficult 2020.The technology sector trailed the overall market for the quarter. The bond market fell during the quarter with optimism about economic growth and worries about inflation as the catalysts for rising bond yields.
The quarter ended with the unveiling of President Joe Biden’s infrastructure plan, fallout from the meltdown of the Archegos Capital hedge fund and continued debate about inflation expectations.
Some of the concerns dominating headlines to start the second quarter are likely to fade while others may have greater impact. The booming market for initial public offerings, popularity of “meme” stocks, rising margin balances and rich valuations for unproven companies are among the most consequential concerns for investors.
