Summary

• U.S. equity markets tumbled on the first trading day of 2021 ahead of a pair of consequential runoff Georgia Senate elections that will determine the balance of power in D.C.
• After ending 2020 with total returns of 17.6%, the S&P 500 finished lower by 1.5% today while the Dow Jones Industrial Average slipped 383 points.
• Real estate equities - which were among the laggards in 2020 - were broadly lower today as the Equity REIT Index slid 3.3% with 17-of-19 property sectors in negative territory.
• On the eve of Election Day in Georgia, betting markets see tomorrow's runoff election as essentially a toss-up. Democrats have the potential for a "trifecta" of control for the first time since President Obama's first two years.
• Employment data highlights this week's economic calendar, headlined by ADP Employment data on Wednesday, Jobless Claims on Thursday, and the BLS Nonfarm Payrolls report on Friday.

Real Estate Daily Recap

U.S. equity markets tumbled on the first trading day of 2021 ahead of a pair of consequential runoff Georgia Senate elections that will determine the balance of power in D.C. for at least the next two years. After ending 2020 with total returns of 17.6%, the S&P 500 ETF (SPY) finished lower by 1.5% today while the Dow Jones Industrial Average (DIA) slipped 383 points. Real estate equities - which were among the laggards in 2020 - were broadly lower today as the Equity REIT ETF (VNQ) slid 3.3% with 17 of 19 property sectors in negative territory. The Mortgage REIT ETF (REM) declined by 3.0%.

On the eve of Election Day in Georgia, betting markets see tomorrow's runoff election as essentially a toss-up as Democrats have the potential for a "trifecta" of control for the first time since President Obama's first two years. As discussed in our Real Estate Weekly Outlook, apart from this week's Georiga elections, all eyes are on the pace of vaccine distribution. Per Bloomberg estimates, nearly 5 million Americans have been vaccinated thus far, the most of any country. Ten of the eleven GICS equity sectors finished in negative territory today, dragged on the downside by the Commercial Real Estate (XLRE), Utilities (XLU), and Industrial (XLI) sectors.

Employment data highlights this week's economic calendar, headlined by ADP Employment data on Wednesday, Jobless Claims on Thursday, and the BLS Nonfarm Payrolls report on Friday. Economists are looking for employment gains to slow to roughly 100k in December following last month's gain of 245k and for the unemployment rate to tick up slightly to 6.8%. We'll also see Construction Spending data on Monday, the weekly MBA Mortgage Application data on Wednesday, and PMI data throughout the week.

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Additional Disclosure: It is not possible to invest directly in an index. Index performance cited in this commentary does not reflect the performance of any fund or other account managed or serviced by Hoya Capital Real Estate. Data quoted represents past performance, which is no guarantee of future results. Information presented is believed to be factual and up-to-date, but we do not guarantee its accuracy.