More than 90% of our country “is not in harm’s way, the virus lockdown flat-out fraud on a massive scale,” said David Stockman, President Ronald Reagan’s former Director of Office of Management and Budget
China Virus trading will go down in history for its high velocity. We have witnessed the fastest market crash met by swiftest rescue package to offset a health emergency at a pace not seen, to my knowledge ever.
Wall Street’s focus was on the growth of coronavirus cases, now faded, has turned its attention to the next phase of the chaos, how quickly the lockdowns end.
The Street know that bad data is a given, that soft earnings are expected, stimulus is priced in.
Whatever path the economic recovery takes, cross-asset strategies are hinging on how fast consumers come back and the sidelined cash comes back to risk on.
People are talking about restrictions being lifted in the next 1 to 2 months. That shortening of the timeline means that the dire economic data that we have seen can be looked through.
Look no further than the economic data crossing the tape Thursday. Gauges of private-sector activity in Europe were disastrous, beyond the grim expectations on the edge of collapse as a divided EU struggles to find $2-T to help an economy already in deep recession.
The scale of the Fed’s and fiscal response has been so huge, it has helped investors see past the pain. And now, just as the relentless bad figures threatened to overwhelm the optimism the largest companies and economies are moving toward re-opening.
The S&P 500 closed last week at the highest in a month+.
The world has yet to fully grasp the COVID-19 coronavirus. If easing restrictions lead to an acceleration in infections or deaths, containment measures could make a swift return.
Former Reagan Administration Office of Management and Budget director David Stockman Thursday blasted the “lockdown nation” triggered by the coronavirus outbreak, alleging public officials have conducted “fraud on a massive scale.”
A key consideration is how to deal with what is being called the 2nd wave of the virus. This is being weighed against the increasing awareness of health problems associated with isolation and lockdown.
As long as things are improving and moving on a timeline where the lockdown is not going to continue for the next year that enough to drive stocks North again.
Thursday, the major US stock market indexes finished at: DJIA +39.44 at 23515.26, NAS Comp -0.63 to 8494.76, S&P 500 -1.51 to 2797.80
Volume: Trade on the NYSE came in at 1.1-B/shares exchanged
- NAS Comp -5.3% YTD
- S&P 500 -13.4% YTD
- DJIA -17.6% YTD
- Russell 2000 -27.2% YTD
HeffX-LTN’s overall technical analysis for the major US stock indexes is Neutral with a Bullish/Very Bullish bias.
Looking Ahead: Investors will receive Durable Goods Orders for March and the revised University of Michigan Index of Consumer Sentiment for April Friday.
Have a healthy day, Keep the Faith!