In this week’s recap: Unemployment reaches an historic low, while stocks climbed in response to economic re-openings.

Weekly Economic Update

Presented by Cornerstone Financial Advisory, LLC May 11, 2020

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THE WEEK ON WALL STREET

Despite an historic downturn in employment, stocks managed to climb higher last week as investors were emboldened by the pace of economic re-openings here and abroad.

The Dow Jones Industrial Average gained 2.56%, while the Standard & Poor’s 500 advanced 3.50%. The Nasdaq Composite Index jumped 6.00% for the week. The MSCI EAFE Index, which tracks developed overseas stock markets, slipped 1.09%.^1,2,3

Tech Stocks Power NASDAQ

Last week’s trading was driven by a crosscurrent of emotions — worries about weak corporate earnings and pace of business re-openings as well as optimism over the pickup in economic activity and progress on developing a vaccine.

Stocks posted back-to-back daily gains to end the week despite troubling employment data. Perhaps the headline of the week was that the technology-heavy NASDAQ Composite Index moved into positive territory year-to-date.^1,2

 

A “Silver Lining” in the Jobs Report?

Last week brought into stark focus the number of jobs lost since the start of the economic shutdown. Since mid-March, unemployment insurance claims have reached 33.5 million.  The pace of newly unemployed has slowed down, however, with recent weeks at about half the rate at the peak in late March.^4,5

April’s employment report, released on Friday, saw a spike to 14.7% in the unemployment rate. As severe as these numbers may be, 88% of April’s newly unemployed characterized their job loss as temporary rather than permanent, as opposed to 47% of the newly unemployed in March who said their job loss was temporary.^6,7

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T I P   O F   T H E   W E E K

Do you and your spouse have very similar investment portfolios? As a couple, you might want to approach the goal of investment diversification from a joint (rather than strictly individual) viewpoint.

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 THE WEEK AHEAD: KEY ECONOMIC DATA

Tuesday: Consumer Price Index.

Thursday: Jobless Claims.

Friday: Retail Sales; Industrial Production.

Source: Econoday, May 8, 2020

The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.

 

THE WEEK AHEAD: COMPANIES REPORTING EARNINGS

Monday: Under Armour (UAA), Simon Property (SPG), Caesars Entertainment (CZR).

Wednesday: Cisco Systems (CSCO).

Source: Zacks, May 8, 2020

Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Any investment should be consistent with your objectives, time frame and risk tolerance. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.

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Q U O T E   O F   T H E   W E E K

“Laughter is inner jogging.”

NORMAN COUSINS

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 T H E   W E E K L Y   R I D D L E

You buy 10 shrubs. How can you plant them in five rows with four in each row?

 

LAST WEEK’S RIDDLE: Can you name three words in everyday English that begin with the letters “dw”?

ANSWER: Any three of these five words will do: dwell, dwelling, dwarf, dweeb, and dwindle.

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 This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. The information herein has been derived from sources believed to be accurate. Please note – investing involves risk, and past performance is no guarantee of future results. Investments will fluctuate and when redeemed may be worth more or less than when originally invested. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All market indices discussed are unmanaged and are not illustrative of any particular investment. Indices do not incur management fees, costs and expenses, and cannot be invested into directly. All economic and performance data is historical and not indicative of future results. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is a market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Standard & Poor’s 500 (S&P 500) is a market-cap weighted index composed of the common stocks of 500 leading companies in leading industries of the U.S. economy. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New York Stock Exchange (the “NYSE”) and NYSE Arca (formerly known as the Archipelago Exchange, or ArcaEx®, and the Pacific Exchange). NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. (NYMEX) is the world’s largest physical commodity futures exchange and the preeminent trading forum for energy and precious metals, with trading conducted through two divisions – the NYMEX Division, home to the energy, platinum, and palladium markets, and the COMEX Division, on which all other metals trade. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards. This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. MarketingPro, Inc. is not affiliated with any person or firm that may be providing this information to you. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. The market indexes discussed are unmanaged and generally considered representative of their respective markets. Individuals cannot directly invest in unmanaged indexes. Past performance does not guarantee future results. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost.

CITATIONS:

1 – The Wall Street Journal, May 8, 2020
2 – The Wall Street Journal, May 8, 2020
3 – The Wall Street Journal, May 8, 2020
4 – CNBC, May 6, 2020
5 – CNBC, May 6, 2020
6 – The Wall Street Journal, May 8, 2020
7 – The Wall Street Journal, May 8, 2020

 

CHART CITATIONS:

The Wall Street Journal, May 8, 2020
The Wall Street Journal, May 8, 2020
Treasury.gov, May 8, 2020

In this week’s recap: Promising drug trials and plans to ease public lockdowns turn thoughts to economic normalization.

Weekly Economic Update

Presented by Cornerstone Financial Advisory, LLC, May 4, 2020

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THE WEEK ON WALL STREET

Stock prices ended the week slightly lower, despite news of positive results from a test trial of a COVID-19 drug treatment and several states easing their economic lockdowns.

The Dow Jones Industrial Average slipped 0.22%, while the Standard & Poor’s 500 lost 0.21%. The Nasdaq Composite Index dropped 0.34%. The MSCI EAFE Index, which tracks developed stock markets overseas, rose 4.34%.^1,2,3

Light at the End of the Tunnel?

Investors were emboldened last week by two significant developments: a quickening in the pace of state re-openings and positive results from a clinical trial of a treatment for COVID-19. These developments turned investor focus toward economic normalization and away from the economic destruction that has occurred.

Market optimism was also supported by earnings reports early in the week, which showed that some companies were navigating reasonably well through the crisis. But stocks retreated on Friday as traders reacted to mixed earnings from two tech titans. The two firms offered a reminder that even the strongest companies have not escaped the economic impact of the pandemic.

Worries over possible new China trade tariffs also weighed on stocks as the trading week came to a close.

 

Corporate Earnings

It was a busy week for corporate earnings reports. So far, the earnings season has been mixed; it has provided some clarity, though, about the impact of COVID-19 on businesses.

With 193 of S&P 500 companies reporting, 65% have checked in with results ahead of consensus Wall Street estimates. Among the better-performing sectors to date were Technology and Consumer Staples. Financials were among the laggards.^4,5,6

 

Final Thought

Despite the continued shutdown of businesses nationwide, stocks staged a powerful rebound in April, leading some to wonder if Wall Street is disconnected from Main Street. But market watchers are quick to point out that Main Street may not be as disconnected as it appears. April’s rally was led by a group of very large companies, with over 75% of stocks in the S&P 500 trading below their 200-day moving average.⁷

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T I P   O F   T H E   W E E K

Before accepting a college loan, be sure that you and your student understand the consequences of a default.

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 THE WEEK AHEAD: KEY ECONOMIC DATA

Monday: Factory Orders.

Wednesday: Automatic Data Processing (ADP) Employment Report.

Thursday: Jobless Claims.

Friday: Employment Situation Report.

Source: Econoday, May 1, 2020

The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.

 

THE WEEK AHEAD: COMPANIES REPORTING EARNINGS

Monday: Skyworks Solutions (SWKS), Tyson Foods (TSN).

Tuesday: Walt Disney (DIS), Electronic Arts (EA), Prudential Financial (PRU), Illinois Tool Works (ITW), Sysco (SYY).

Wednesday: Square (SQ), CVS Health (CVS), General Motors (GM), Shopify (SHOP), T-Mobile (TMUS).

Thursday: Bristol-Myers (BMY), Anheuser-Busch (BUD), Becton Dickinson (BDX), Danaher Corp. (DHR).

Source: Zacks, May 1, 2020

Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Any investment should be consistent with your objectives, time frame and risk tolerance. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.

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Q U O T E   O F   T H E   W E E K

“The greatest obstacle to discovery is not ignorance – it is the illusion of knowledge.”

DANIEL BOORSTIN

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 T H E   W E E K L Y   R I D D L E

Can you name three words in everyday English that begin with the letters “dw”?

 

LAST WEEK’S RIDDLE: Can you name two perennial vegetables? (That is, vegetables that don’t need to be replanted and that can live on to produce in a future growing season?)

ANSWER: Asparagus and rhubarb.

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 This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. The information herein has been derived from sources believed to be accurate. Please note – investing involves risk, and past performance is no guarantee of future results. Investments will fluctuate and when redeemed may be worth more or less than when originally invested. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All market indices discussed are unmanaged and are not illustrative of any particular investment. Indices do not incur management fees, costs and expenses, and cannot be invested into directly. All economic and performance data is historical and not indicative of future results. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is a market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Standard & Poor’s 500 (S&P 500) is a market-cap weighted index composed of the common stocks of 500 leading companies in leading industries of the U.S. economy. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New York Stock Exchange (the “NYSE”) and NYSE Arca (formerly known as the Archipelago Exchange, or ArcaEx®, and the Pacific Exchange). NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. (NYMEX) is the world’s largest physical commodity futures exchange and the preeminent trading forum for energy and precious metals, with trading conducted through two divisions – the NYMEX Division, home to the energy, platinum, and palladium markets, and the COMEX Division, on which all other metals trade. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards. This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. MarketingPro, Inc. is not affiliated with any person or firm that may be providing this information to you. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. The market indexes discussed are unmanaged and generally considered representative of their respective markets. Individuals cannot directly invest in unmanaged indexes. Past performance does not guarantee future results. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost.

CITATIONS:

1 – The Wall Street Journal, May 1, 2020
2 – The Wall Street Journal, May 1, 2020
3 – The Wall Street Journal, May 1, 2020
4 – NASDAQ, April 30, 2020
5 – NASDAQ, April 30, 2020
6 – NASDAQ, April 30, 2020
7 – Index Indicators, May 1, 2020

CHART CITATIONS:

The Wall Street Journal, May 1, 2020
The Wall Street Journal, May 1, 2020
Treasury.gov, May 1, 2020

In this week’s recap: Markets react to the plunging oil prices, corporate earnings, and the first attempts to restart the U.S. economy.

Weekly Economic Update

Presented by Cornerstone Financial Advisory, LLC, April 27, 2020

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THE WEEK ON WALL STREET

Stock prices bounced around last week as investors reacted to wild swings in the price of oil and reports that called into question the efficacy of two potential virus treatments.

The Dow Jones Industrial Average retreated 1.93%, while the Standard & Poor’s 500 lost 1.32%. The Nasdaq Composite Index slipped 0.18%. The MSCI EAFE Index, which tracks developed stock markets overseas, declined 1.21%.^1,2,3

 

Oil Wavers, Promising Virus Treatments Disappoint

Stocks opened the new week lower on the heels of a plunge in oil prices that saw the May oil futures contract fall into negative territory. While negative prices were largely reflective of technical issues associated with trading the contracts rather than the actual price of oil, the unprecedented move unsettled investors.

Stocks found some positive momentum as the week wore on, buoyed by corporate earnings reports that showed solid performance amid a challenging environment.

On two separate days, however, moves to the upside were derailed by disappointing news on promising COVID-19 treatments. One drug failed to produce positive results in its first trial, followed the next day by an FDA warning against taking chloroquine and hydroxychloroquine to treat COVID-19. Stocks managed to rally and trim the week’s losses during the final hours on Friday.

 

The Economic Reopening Begins

States across the nation, including Georgia, Tennessee, South Carolina, and Texas, have begun the process of slowly reopening commerce, while Montana’s governor announced the first phase of restarting its economy.^4,5

Each state is taking a different approach, potentially serving as a laboratory to help guide other states in their efforts to reopen businesses. From the market’s perspective, these early steps are not only hopeful signs that the journey to normalization may have begun, but they may provide important clues to how quickly business activity can rebound and the degree to which individuals resume social engagement – two important metrics that may influence the market in the weeks ahead.

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T I P   O F   T H E   W E E K

Do you really need a weekly housecleaning service, a gardener, or a dog walker? The money you save by not using these services could go toward debts, an emergency fund, or investing.

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 THE WEEK AHEAD: KEY ECONOMIC DATA

Wednesday: Gross Domestic Product (GDP). Federal Open Market Committee (FOMC) Meeting Announcement.

Thursday: Jobless Claims.

Friday: Purchasing Managers Index (PMI): Manufacturing Index. Institute for Supply Management (ISM) Manufacturing Index.

Source: Econoday, April 24, 2020

The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.

 

THE WEEK AHEAD: COMPANIES REPORTING EARNINGS

Tuesday: Advanced Micro Devices (AMD), Ford Motor Company (F), Pfizer (PFE), Caterpillar (CAT), Starbucks (SBUX), Merck & Co. (MRK), United Parcel Service (UPS), D.R. Horton (DHI).

Wednesday: Microsoft (MSFT), Facebook (FB), Boeing (BA), Tesla (TSLA), Qualcomm (QCOM).

Thursday: Apple (AAPL), Amazon (AMZN), Visa (V), McDonald’s (MCD), Gilead Sciences (GILD).

Friday: Exxon Mobil (XOM), Chevron (CVX), Clorox (CLX), Abbvie (ABBV).

Source: Zacks, April 24, 2020

Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Any investment should be consistent with your objectives, time frame and risk tolerance. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.

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Q U O T E   O F   T H E   W E E K

“It is a kingly act to assist the fallen.”

OVID

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 T H E   W E E K L Y   R I D D L E

Can you name two perennial vegetables? (That is, vegetables that don’t need to be replanted and can live on, yielding a future growing season?)

 

LAST WEEK’S RIDDLE: Can you name a sport in which neither the spectators, nor the participants, know the score or the winner until the match ends?

ANSWER: Boxing.

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This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. The information herein has been derived from sources believed to be accurate. Please note – investing involves risk, and past performance is no guarantee of future results. Investments will fluctuate and when redeemed may be worth more or less than when originally invested. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All market indices discussed are unmanaged and are not illustrative of any particular investment. Indices do not incur management fees, costs and expenses, and cannot be invested into directly. All economic and performance data is historical and not indicative of future results. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is a market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Standard & Poor’s 500 (S&P 500) is a market-cap weighted index composed of the common stocks of 500 leading companies in leading industries of the U.S. economy. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New York Stock Exchange (the “NYSE”) and NYSE Arca (formerly known as the Archipelago Exchange, or ArcaEx®, and the Pacific Exchange). NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. (NYMEX) is the world’s largest physical commodity futures exchange and the preeminent trading forum for energy and precious metals, with trading conducted through two divisions – the NYMEX Division, home to the energy, platinum, and palladium markets, and the COMEX Division, on which all other metals trade. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards. This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. MarketingPro, Inc. is not affiliated with any person or firm that may be providing this information to you. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. The Wall Street Journal, April 24, 2020. The market indexes discussed are unmanaged and generally considered representative of their respective markets. Individuals cannot directly invest in unmanaged indexes. Past performance does not guarantee future results. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost.

CITATIONS:

1 – The Wall Street Journal, April 24, 2020
2 – The Wall Street Journal, April 24, 2020
3 – The Wall Street Journal, April 24, 2020
4 – US News & World Report, April 21, 2020
5 – US News & World Report, April 22, 2020

CHART CITATIONS:

The Wall Street Journal, April 24, 2020
The Wall Street Journal, April 24, 2020
Treasury.gov, April 24, 2020

In this week’s recap: The White House makes plans to reopen the economy, as analysts examine the first-hard economic data reckoning the U.S. reaction to COVID-19.

Weekly Economic Update

Presented by Cornerstone Financial Advisory, LLC, April 20, 2020

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THE WEEK ON WALL STREET

Stock prices pushed higher last week as news of a White House plan to reopen the economy and reports of a potential COVID-19 treatment helped the market overcome weak economic data and an ugly start to the corporate earnings season.

The Dow Jones Industrial Average rose 2.21%, while the Standard & Poor’s 500 advanced 3.04%. The Nasdaq Composite Index gained 6.09% for the week. The MSCI EAFE Index, which tracks developed overseas stock markets, slumped 1.75%.^1,2,3

Reality Hits

Until last week, the extent of the economic damage from COVID-19 lacked a lot of hard data. With the release of retail sales (down 8.7% for March), industrial production (down 5.4% in March), and new jobless claims of 5.2 million (bringing the four-week total to 22 million), the scope of economic trouble became clearer.^4,5,6

Stocks wavered throughout the week as investors digested the economic data and balanced the reports against signs that the pandemic may have peaked. With news of a plan to restart the economy and promising test results of a COVID-19 treatment, market sentiment turned positive, sending stocks higher on the final day of trading and cementing the second consecutive week of gains.

 

Corporate Earnings

Large banks kicked off the quarterly earnings season, reporting declines in profits as they hiked loan loss reserves and saw a contraction in consumer credit card use. The large loan loss reserves represent a sobering view on just how much the banks believe small businesses and consumers may be affected by the economic downturn.

 

Final Thought

With bank earnings reports, investors got an important – but limited – view of the state of the economy. This week’s earnings reports are expected to provide a much broader cross-section of the economy, with a number of consumer products, technology, industrial, transportation, and communication services companies reporting.

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T I P   O F   T H E   W E E K

A cleverly promoted, inexpensive customer loyalty program may help your business realize improved long-term cash flow.

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THE WEEK AHEAD: KEY ECONOMIC DATA

Tuesday: Existing Home Sales. 

Thursday: New Home Sales. Jobless Claims.

Friday: Durable Goods Orders. Consumer Sentiment.

Source: Econoday, April 17, 2020

The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.

 

THE WEEK AHEAD: COMPANIES REPORTING EARNINGS

Monday: IBM (IBM), Halliburton (HAL)

Tuesday: Netflix (NFLX), Procter & Gamble (PG), Coca-Cola (KO), United Airlines (UA)

Wednesday: Facebook (FB), AT&T (T), Boeing (BA), Tesla (TSLA), Visa (V)

Thursday: Amazon (AMZN), Intel (INTC), Starbucks (SBUX), 3M Company (MMM), Southwest Airlines (LUV)

Friday: Verizon (VZ), American Airlines (AAL), American Express (AXP)

Source: Zacks, April 17, 2020

Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Any investment should be consistent with your objectives, time frame and risk tolerance. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.

 

 

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Q U O T E   O F   T H E   W E E K

“In a society of super-sophisticated communication, we often suffer from a shortage of listeners.”

ERMA BOMBECK

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T H E   W E E K L Y   R I D D L E

Can you name a sport in which neither the spectators nor the participants know the score or the winner until the match ends?

 

LAST WEEK’S RIDDLE: Can you name a vegetable or fruit that is never sold frozen, canned, processed, cooked, or in any other form except fresh?

ANSWER: Lettuce.

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This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. The information herein has been derived from sources believed to be accurate. Please note – investing involves risk, and past performance is no guarantee of future results. Investments will fluctuate and when redeemed may be worth more or less than when originally invested. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All market indices discussed are unmanaged and are not illustrative of any particular investment. Indices do not incur management fees, costs and expenses, and cannot be invested into directly. All economic and performance data is historical and not indicative of future results. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is a market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Standard & Poor’s 500 (S&P 500) is a market-cap weighted index composed of the common stocks of 500 leading companies in leading industries of the U.S. economy. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New York Stock Exchange (the “NYSE”) and NYSE Arca (formerly known as the Archipelago Exchange, or ArcaEx®, and the Pacific Exchange). NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. (NYMEX) is the world’s largest physical commodity futures exchange and the preeminent trading forum for energy and precious metals, with trading conducted through two divisions – the NYMEX Division, home to the energy, platinum, and palladium markets, and the COMEX Division, on which all other metals trade. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards. This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. MarketingPro, Inc. is not affiliated with any person or firm that may be providing this information to you. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. The market indexes discussed are unmanaged and generally considered representative of their respective markets. Individuals cannot directly invest in unmanaged indexes. Past performance does not guarantee future results. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost.

CITATIONS:

1 – The Wall Street Journal, April 17, 2020.
2 – The Wall Street Journal, April 17, 2020.
3 – The Wall Street Journal, April 17, 2020.
4 – The Wall Street Journal, April 15, 2020.
5 – MarketWatch, April 15, 2020.
6 – The Wall Street Journal, April 16, 2020.

CHART CITATIONS:

The Wall Street Journal, April 17, 2020.
The Wall Street Journal, April 17, 2020.
Treasury.gov, April 17, 2020.

In this week’s recap: A broad stock market rally, promising signs with COVID-19, and another Federal Reserve program ahead.

Weekly Economic Update

Presented by Cornerstone Financial Advisory, LLC, April 13, 2020

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THE WEEK ON WALL STREET

The stock market staged a broad rally this week, buoyed by the prospect that the COVID-19’s grip on the nation may be easing and news of another Federal Reserve program to help stabilize businesses.

The Dow Jones Industrial Average jumped 12.67%, while the Standard & Poor’s 500 climbed 12.10%. The Nasdaq Composite Index rose 10.59% for the week. The MSCI EAFE Index, which tracks developed overseas stock markets, advanced 6.32%.^1,2,3

A Change in Sentiment

Market sentiment took a more hopeful turn on news of an apparent peaking of cases in Italy and New York State. Investors also welcomed comments by Dr. Anthony Fauci that the start of a turnaround in the outbreak is close at hand.

The S&P 500 Index surged 7.03% to start the week and added to gains as the week progressed. Positive trends in COVID-19 cases, an agreement between Russia and Saudi Arabia to cut oil production, and the Fed’s unveiling of a $2.5 trillion loan program to assist small and midsized businesses fueled the rally.^4,5

 

Credit Markets Stabilize

As the economy shut down in March, credit markets began to exhibit deep stresses. A functional bond market is essential to economic and financial health, which is why the Federal Reserve initiated a number of actions aimed at helping them to operate.

 

Intervention by the Fed appears to have helped. A raft of new bond offerings may be signaling that investors are now willing to take on more risk. Last week, 11 investment-grade companies sold nearly $20 billion in bonds.⁶

A stable credit market helps the stock market, and while the bond market is not yet out of the woods, its improving health is a positive sign.

 

Final Thought 

One of the major challenges for investors in the last month has been determining realistic stock valuations amid uncertainty over corporate earnings. With earnings season about to unfold, investors may be able to better gauge the impact of the pandemic on company profits. Investors will get to hear from corporate leaders about the state of their businesses and possibly their outlook for the next few quarters. This may help fill in the gap that currently exists, but what remains uncertain is whether that information proves to be positive or negative for the market.

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T I P   O F   T H E   W E E K

If you are marrying, take a moment to see how your new marital status will affect your federal and state taxes and whether it would be best to file jointly or separately.

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 THE WEEK AHEAD: KEY ECONOMIC DATA

Wednesday: Retail Sales. Industrial Production.

Thursday: Housing Starts. Jobless Claims.

Friday: Index of Leading Economic Indicators.

Source: Econoday, April 9, 2020

The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.

 

THE WEEK AHEAD: COMPANIES REPORTING EARNINGS

Tuesday: Johnson and Johnson (JNJ), JP Morgan Chase (JPM), Wells Fargo (WFC)

Wednesday: Bank of America (BAC), UnitedHealth Group (UNH), Citigroup (C), Goldman Sachs (GS)

Thursday: Blackstone Group (BX), Taiwan Semiconductor (TSM), Abbott Laboratories (ABT)

Friday: Schlumberger (SLB), Kansas City Southern (KSU)

Source: Zacks, April 9, 2020

Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Any investment should be consistent with your objectives, time frame and risk tolerance. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.

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Q U O T E   O F   T H E   W E E K

“One worthwhile task carried to a successful conclusion is worth half-a-hundred half-finished tasks.”

MALCOLM FORBES

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 T H E   W E E K L Y   R I D D L E

Can you name a vegetable or fruit that is never sold frozen, canned, processed, cooked, or in any other form except fresh?

 

LAST WEEK’S RIDDLE: Can you name six or more things that you can wear on your feet starting with the letter S?

ANSWER: Shoes, socks, sandals, sneakers, slippers, skis, skates, snowshoes, stockings, stilts.

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 This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. The information herein has been derived from sources believed to be accurate. Please note – investing involves risk, and past performance is no guarantee of future results. Investments will fluctuate and when redeemed may be worth more or less than when originally invested. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All market indices discussed are unmanaged and are not illustrative of any particular investment. Indices do not incur management fees, costs and expenses, and cannot be invested into directly. All economic and performance data is historical and not indicative of future results. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is a market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Standard & Poor’s 500 (S&P 500) is a market-cap weighted index composed of the common stocks of 500 leading companies in leading industries of the U.S. economy. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New York Stock Exchange (the “NYSE”) and NYSE Arca (formerly known as the Archipelago Exchange, or ArcaEx®, and the Pacific Exchange). NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. (NYMEX) is the world’s largest physical commodity futures exchange and the preeminent trading forum for energy and precious metals, with trading conducted through two divisions – the NYMEX Division, home to the energy, platinum, and palladium markets, and the COMEX Division, on which all other metals trade. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards. This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. MarketingPro, Inc. is not affiliated with any person or firm that may be providing this information to you. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional.

CITATIONS:

1 – The Wall Street Journal, April 9, 2020.
2 – The Wall Street Journal, April 9, 2020.
3 – The Wall Street Journal, April 9, 2020.
4 – CNBC, April 6, 2020.
5 – The Wall Street Journal, April 9, 2020.
6 – Bloomberg, April 6, 2020.

CHART CITATIONS:

The Wall Street Journal, April 9, 2020.
The Wall Street Journal, April 9, 2020.
Treasury.gov, April 9, 2020.