A Month In Brief

U.S. Markets

Stocks rebounded sharply in April, fueled by a flattening pandemic curve and positive results from a clinical trial investigating a treatment for COVID-19.

The Dow Jones Industrial Average, which dropped 1% in March, jumped 11.08%. The Standard & Poor’s 500 Index rose 12.68%, and the NASDAQ Composite surged 15.45%.1

Slowdown in Infections

Just as it appeared that April might be a repeat of March, stocks turned higher with signs of a slowdown in COVID-19 infections, especially in Italy and New York state. Though jobless claims were breathtakingly high, they were expected, allowing investors to focus on positive developments. A more stable bond market also helped support the rally.

The stock market struggled to move higher, as a weak start to earnings season and troubling economic data created some underlying crosscurrents.

Gains Despite Stalled Momentum

Momentum stalled as oil prices drifted lower, but accelerated again on the news of positive results from a clinical trial investigating a treatment for COVID-19.

Stocks continue to climb higher as more states begin the initial phase of reopening their economies and others have announced target reopening dates.

Sector Scorecard

All industry sectors moved higher in April, with increases in Communication Services (+18.10%), Consumer Discretionary (+19.66%), Consumer Staples (+10.19%), Energy (+37.17%), Financials (+11.28%), Health Care (+17.88%), Industrials (+11.24%), Materials (+20.81%), Real Estate (+9.45%), Technology (+16.83%), and Utilities (+5.26%).2

What Investors May Be Talking About in May

The national dialogue over the COVID-19 outbreak has shifted toward restarting the economy, with state and national leaders devoting more attention to plans of loosening the shelter-in-place and social-distancing guidelines.

There are two key aspects that investors may be watching as they try to figure out the pace of the recovery.

State by State

The first factor is the nature of the reopening. The White House plan for restarting the economy involves a three-step process, but leaves the decision-making to the governors of the states. The reopening timing and process may vary depending on health experts’ assessments of the risk profile of each state as well as voter sentiment to return to their usual activities.

The second factor is the public’s confidence in resuming their pre-quarantine routines. How soon will people be showing up to work, going out to eat, and traveling? That is a clear unknown at this time.



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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. 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 30, 2020

2 - FactSet Research, April 30, 2020

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