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Our 2021 Midyear Market Update

Our 2021 Midyear Market Update

July 23, 2021

After what 2020 threw at us, I think it’s increasingly clear to everyone that life is unpredictable and we don’t have nearly as much control as we think. In a year, we changed how we work, go to school, and even how we interact with people. The ongoing chaos and confusion had most of us entering 2021 with apprehension. 

While there are still unknowns, believe it or not, we’re now more than halfway through the year—and July is the perfect time to reflect and review what’s happened so far in 2021, as we continue to recover emotionally and economically from the pandemic. 

Stock Market Performance

As many businesses have returned to normal, some experts believe we may be entering a booming economy. (1) Stock market performance was mildly volatile in the first half of the year, with an overall trend toward growth. 

The S&P 500 reached its highest level this year on May 7, with a year-to-date return of 16% as of June 30. The Dow Jones has also shown overall growth so far this year and was up 14% as of June 30. Meanwhile, the NASDAQ showed greater volatility, with a yearly low of -2.17% in early March, up to 9.7% at the end of April, and climbing higher to 14.22% as of June 30. 

Many experts have warned that while they are optimistic about market performance in 2021, that performance will likely be riddled with volatility throughout 2021 and in the coming years. (2)

Employment Levels 

It has been generally expected that as businesses reopen to full capacity, the number of unemployment claims will drop and employment levels will return to normal. However, this is currently not the case. (3) Along with other businesses in the service industry, restaurants are especially struggling to staff up in the face of increasing consumer demand.

Some commentators believe workers are reluctant to return to work because of continued unemployment assistance from federal and state governments. Others argue that many workers are unable to return to work for various reasons, including lingering fears of the coronavirus and childcare needs. But, whatever the reason for the worker shortage, worker benefits and wages may undergo drastic changes in 2021 and beyond as the economy returns to normal and getting workers back into the workforce remains a key component of the U.S. recovery plan. 

Interest Rates and the Federal Reserve

Interest rates continued to remain low, as the Federal Reserve promised. In an effort to encourage consumers to keep borrowing, the Fed has kept interest rates near zero since the onset of the pandemic. The Fed has stated it will likely not raise rates again until 2023, when it is more likely that inflation rates will reach desired targets. (4)

For now, the near-zero interest rates may be attracting first-time homebuyers who have been able to weather the economic pressures from the pandemic. However, home prices have surged 13.2% over the past year, (5) igniting some fears that a housing bubble may be looming.

What Does This Mean for You? 

We’ve always known that predicting market performance with accuracy is impossible. But 2020 and 2021 have shown us that market performance may be impossible to predict at all. Although we can’t fully know what lies ahead, don’t let that prevent you from taking the steps to protect yourself and pursue financial freedom.

Setting financial goals is wise, but don’t stop there. Now more than ever, it’s essential to make the right financial decisions to move you closer to achieving those goals. The global pandemic, along with all of its social-distancing guidelines, reminded us of the value of personal attention—and this absolutely extends to financial matters. Since choosing a financial advisor to manage your wealth is such an important life decision, I’d love to talk with you to see if I am the right fit to help you pursue your ideal financial future. Email me at or give me a call at (916) 276-8677 to get started. 

About Jim

James Callens is a financial advisor at GLH&C Financial Services, a full-service, comprehensive wealth management firm. Jim has over 30 years of experience in the financial industry and uses his extensive resources and knowledge to help his clients experience simplicity and clarity in their financial lives. Jim spent more than 20 years working for GE Financial Advisors, both in its insurance services department and as a regional manager and financial advisor. He took part in GE’s Six Sigma Quality Training program and completed the National Association of Life Underwriter’s four-year LUTCF course. Jim also earned his certificate in financial planning from the University of California at Davis. In 2011, Jim combined his own firm, Callens Financial Group, with GLH Financial Services, creating GLH&C Financial Services, so he could provide even more value to his clients. 

Jim is a member of the Financial Planning Association of Northern California and National Association of International & Financial Advisors (NAIFA). He has served as a board member for several nonprofit organizations and has been involved in Cub Scouts leadership and youth sports coaching. Jim lives in Folsom, California, with his wife, Melissa, and his four children, Jacob, Kristen, Grant, and Andrew. Together, they enjoy outdoor activities like kayaking, bicycling, and vacationing at Lake Tahoe. To learn more about Jim, connect with him on LinkedIn.