6/16/20 Market Notes
US equity markets overcame early pressure on Monday to finish with solid gains after the Fed announced details of its plan to purchase individual corporate bonds. The S&P 500 added 25 points (0.8%) to 3,067 while the Dow gained 158 points (0.6%) to 25,763 and the Nasdaq rose 137 points (1.4%). Reports of new Covid-19 cases in China and some US states fueled fears of a second wave of infections potentially leading to a slower economic recovery. This caused early selling among economically sensitive sectors and the names that drove stocks higher earlier in June. Stocks rallied back with the Dow swinging over 1,000 points in heavy volume. Treasury yields remained mostly unchanged while the Dollar and gold lost ground. The Empire Manufacturing Index surprised considerably to the upside, indicating the economy continues to improve.
Global stocks rallied overnight on news of plans for additional US stimulus along with signs of ongoing liquidity support from central banks. Retail sales and industrial production data releases before the bell are expected to show strong gains from April lows. At 10:00am, Fed Chair Jerome Powell begins his semi-annual testimony before the Joint Economic Committee on Recent Federal Reserve actions and the US economic outlook.
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.