DC Today is a daily missive from the Dividend Cafe of The Bahnsen Group. While the Dividend Cafe’s weekly market commentary is meant to be long-form, macroeconomic, and principle-driven, the DC Today’s purpose is to provide a daily synopsis of markets, politics, and current events. It will be short, sweet, and hopefully, informative. Our goal is to bring you the latest and most relevant market information and insights, written only by us. Please feel free to share The DC Today with your friends and family. And of course, we always welcome your feedback as to how we can make it more relevant and practical for you!

Dear Valued Clients and Friends –

Let’s get right into it this evening …

Market Action

  • Futures were modestly up last evening and up ~75 points early this morning.  The market opened slightly down then went slightly up.  Throughout the day, we went up then down then up again – mostly normal intra-day volatility, closing +60 points on the nose, with the S&P 500 up .04% (flat) and the Nasdaq up 0.28%.

*FactSet, DJIA, Jan. 12, 2021

  • Energy was the top-performing sector today, and Health Care and Utilities were the bottom-performing sectors.
  • On Monday’s market decline, the decliners barely outnumbered the advancers, pointing to continued low breadth whenever markets are to the downside.  More significantly, even as broad indexes were down, the “average stock” was actually up, with indexes only down as larger capitalization names lagged.
  • This was the seventh consecutive day of the ten-year Treasury yield moving higher, hitting 1.18% earlier before closing at 1.13%
  • Why are we not super enthusiastic about big index investing at these levels, and why do we have a bias towards active management and dividend growth?

*Strategas Research, Daily Macro Brief, Jan. 12, 2021

Now, none of the above means relatively high valuations cannot get higher.  And in fact, the zero interest rate environment does distort some of the historical reality of this.  But on a risk/reward basis, being valuation-conscious, these things have to be at least understood when your market return depends on the whole market, particularly cap-weighted.

Top New Stories

  • A rather significant investigation is underway at the DOJ and FBI on the incidents in the capitol last week, and it would appear the scope of their inquiry and the potential for successful and serious prosecutions are greater than some of us may have feared.  There are currently 160 open cases.
  • The Department of Homeland Security head, Chad Wolf, resigned yesterday, the third cabinet official to resign since last week.
  • I suppose the story of censure/impeachment/articles/etc. will be all over the airwaves the next day or two, and there are several pieces to this story still in motion.  The House will likely vote to impeach and any action in the Senate is likely on hold until at least after the Biden inauguration, and potentially much longer than that.
  • Alabama won the college football national championship, crushing Ohio State last night.

Economic Front

  • The NFIB Small Business Optimism Index dropped from 101.4 to 95.9 in December, a by-product of both COVID policies last month and political dynamics.  This was the weakest reading since the month of May.


  • The CDC updated the vaccine data from yesterday.  25.5 million vaccines have now been distributed domestically, with 8.98 million administered as of yesterday.  The pressure on the states screwing up administration has grown to a point of urgency, with several under-performing states drastically changing policy in the last two days to more reflect the policies of states that have had better success in vaccine distribution.
  • U.S. health officials have reversed prior guidance and are now releasing second doses to anyone over 65 and all with pre-existing conditions.  At state and federal level, the “anyone with an available arm” approach is slowly becoming the consensus policy bias.
  • Presented without comment for those monitoring public policy on this:

  • I also thought this chart was helpful in understanding where we are right now with Influenza compared to normal, as we deal with COVID classifications and results.

*Center for Disease Control, ILINet, Jan. 11, 2021

Public Policy

  • President-elect Biden today named Gary Gensler the new head of the Securities and Exchange Commission.  Mr. Gensler was the head of the CFTC from 2009-2014 and has a long career in financial markets regulation, and prior to that, as an investment banker at Goldman Sachs.  I have met Gary on multiple occasions and am not surprised by the pick, and don’t believe financial markets will be, either.
  • Ohio Democrat, Sherrod Brown, is going to chair the Senate Banking Committee in the new Congress, a sharp turn in regulatory ideology.
  • The new $284 billion PPP program (for companies coming back for round two) has opened and applications are now being taken.

Federal Reserve

  • Esther George, a non-voting board member of the Fed, acknowledged today that while aggregate inflation remains low, some hard-hit services sectors are disproportionately impacting that number.  She seemed to be more inflation hawkish than most Fed governors.  High profile Fed Governor, James Bullard, also said in a recent interview that he sees inflation outpacing expectations.  I expect more jawboning from select governors about inflation, and I expect exactly nothing to come of it.

Oil and Energy

  • WTI crude oil closed today at $53.21.  5.8 million barrels were draw down last week, really reducing inventory excess more than expected and surprising markets.

On deck

  • The House will take up the impeachment articles tomorrow, barring any last-minute intervention (a couple of which are still possible, believe it or not)
  • Futures are flat in the early evening.
  • Earnings season launches in two days.

Clients receive the weekly portfolio report in the morning.  Busy days, busy nights, busy times.

With regards,

David L. Bahnsen
Chief Investment Officer, Managing Partner

The Bahnsen Group

The DC Today features research from S&P, Baird, Barclays, Goldman Sachs, and the IRN research platform of FactSet.

The Bahnsen Group is registered with HighTower Securities, LLC, member FINRA and SIPC, and with HighTower Advisors, LLC, a registered investment advisor with the SEC. Securities are offered through HighTower Securities, LLC; advisory services are offered through HighTower Advisors, LLC.

This is not an offer to buy or sell securities. No investment process is free of risk, and there is no guarantee that the investment process or the investment opportunities referenced herein will be profitable. Past performance is not indicative of current or future performance and is not a guarantee. The investment opportunities referenced herein may not be suitable for all investors.

All data and information reference herein are from sources believed to be reliable. Any opinions, news, research, analyses, prices, or other information contained in this research is provided as general market commentary, it does not constitute investment advice. The team and HighTower shall not in any way be liable for claims, and make no expressed or implied representations or warranties as to the accuracy or completeness of the data and other information, or for statements or errors contained in or omissions from the obtained data and information referenced herein. The data and information are provided as of the date referenced. Such data and information are subject to change without notice.

This document was created for informational purposes only; the opinions expressed are solely those of the team and do not represent those of HighTower Advisors, LLC, or any of its affiliates.

About the Author


Founder, Managing Partner,
and Chief Investment Officer

David is a frequent guest on CNBC, Bloomberg, and Fox Business and is a regular contributor to National Review and Forbes. David serves on the Board of Directors for the National Review Institute and is a founding Trustee for Pacifica Christian High School of Orange County.

He is the author of the books, Crisis of Responsibility: Our Cultural Addiction to Blame and How You Can Cure It (Post Hill Press), The Case for Dividend Growth: Investing in a Post-Crisis World (Post Hill Press) and his latest, Elizabeth Warren: How Her Presidency Would Destroy the Middle Class and the American Dream (2020).

Play Video
Play Video
Play Video
Play Video
Play Video
Play Video
Play Video
Play Video