7/7/20 Market Notes
A surprisingly strong read on the ISM Non-manufacturing Report coupled with positive production data from China led equities higher on Monday despite an accelerating resurgence of US virus cases and hospital admissions. The S&P 500 Index jumped 50 points (1.6%) to 3,180, the Dow added 460 points (1.8%) to 26,287, and the Nasdaq rose 226 points (2.2%) to 10,434. Technology and Consumer Discretionary sectors were the biggest gainers while Real Estate and Utilities lagged. M&A was also in focus with Uber Technologies agreeing to acquire Postmates for $2.7 billion and Berkshire Hathaway buying Dominion Energy’s gas transmission and storage assets. Treasury prices dipped along with the dollar and crude oil prices, while gold ticked higher.
Equities appear ready to take pause from the recent run up as investors continue to weigh unprecedented liquidity and stimulus vs. a virus that has shown no meaningful signs of being under control. Asian stocks finished mostly lower overnight and European equities are broadly down on German June production data that missed forecasts. S&P Futures are down roughly 1% as of 6:30 a.m. Earnings season kicks off next week, and with more companies than not withholding guidance, volatility is likely to remain elevated as investors scrutinize every new piece of data for signs of the strength and shape of the recovery.
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.