US Stock Markets Ended April 10, 2020
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Positive moves in the S&P 500 pushed the index back to mid March levels. All but 10 stocks in the index had positive returns last week with the index posting its biggest weekly gain since 1974. Retailers and cruise liners, previously thought to be relics of the past, were some of the best performing stocks coming off rock bottom prices. Kohl's rallied over 70% after investors flocked to the company's strong balance sheet and strategic position versus its peers. Royal Caribbean and Norwegian Cruise Lines were also top performers, but their earnings are in peril after the Center for Disease Control extended the "no sail order" for at least 100 days. Currently there are about 100 ships scattered off US coasts. Around the country, state governments are coping with the rush of unemployment claims stemming from the coronavirus disruption. To combat an even greater economic slowdown, the Federal Reserve pledged to provide support of up to $2.3 trillion in loans to various institutions including small and mid-sized businesses and state and local governments. This fresh round of available funds is on top of the record stimulus the Fed has provided to dam the flood of the virus impact. Outside the US, the International Monetary Fund has moved to grant access to emergency financing to half of its 189 member countries currently seeking aid. The IMF is ready to use its $1 trillion of lending power if the global crisis continues longer than expected or a second wave of the disease resurfaces later in the year. Oil prices have fallen by half this year as the combination of the virus and price war saw producers flood the market with crude. On Thursday, Saudi Arabia and Russia agreed to slash their output with other OPEC members resulting in prices stabilizing in the oil market. The drop in prices had threatened oil linked countries economic foothold and oil company spending in the face of uncertainty. Next week, 34 companies in the S&P 500 report quarterly earnings. Next week, investors will look to the big banks such as JPMorgan Chase & Co and Bank of America and the health care sector's. United Health and Johnson & Johnson to gauge the impact of COVID-19 on corporate earnings during the first quarter.
Posted on Monday, April 13, 2020 @ 8:38 AM

These posts were prepared by First Trust Advisors L.P., and reflect the current opinion of the authors. They are based upon sources and data believed to be accurate and reliable. Opinions and forward looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security.