4/24/20 Market Notes
Oil prices continued to rebound from their historic sell-off earlier this week, as Brent Crude rose 6% to $21.58. Stocks had been up sharply through most of the day before a report surfaced that the treatment for COVID-19 that Gilead Sciences had been testing appeared to be less effective than previously thought; consequently, stocks relinquished a large portion of their gains. The reaction to the news by market participants is both understandable and rational, which is a positive sign, indicating that stocks are trading on fundamentals. Year to date the S&P is now down about 13%, and down roughly 4 ½% over the past 12 months. The S&P and NASDAQ were flat yesterday, while the Dow Jones Industrial Average eked out a ¼% gin and the Russell 2000 index rallied 1.04%. The Ten Year Treasury Yield fell 2 basis points to 0.598%, while gold prices rose above $1,750 as the U.S. dollar strengthened. On a sector basis, six of the eleven sectors comprising the S&P ended higher, led by the energy sector which gained more than 3%, while Utilities and the Real Estate sector lagged with a great than 1% decline. Overnight, Asian and European bourses are lower in reaction to the news that the Gilead drug isn’t as effective as hoped for. On the economic front, March Durable Goods orders fell more than expected, declining 14.4% versus the expected 11.9% drop. Looking ahead to next week, critical economic reports include:
Tuesday: (February) Case Shiller Home Prices, Q1 Housing Vacancies, April Consumer Confidence
Wednesday: Q1 GDP, March Pending Home Sales, FOMC announcement and press conference
Thursday: Unemployment data, March Personal Income & Spending, April Chicago PMI
Friday: April Markit & ISM Manufacturing PMI, April Motor Vehicle Sales
Disclosures: This market commentary is written by the 1879 Advisors® and represents the views of 1879 Advisors®. This commentary is not investment advice and should not be used as a basis to make investment decisions. Please consult with your registered investment advisor before making any investment decisions.