June 25, 2020

Good morning,

The U.S. equity markets sold off yesterday as news of a significant rise of new COVID-19 cases across the country spooked the markets.  The Dow Jones Industrial Average dropped more than 710 points, or a loss of 2.72%.  The S&P 500 and NASDAQ sank right with the Dow, losing 81 and 222 points, or 2.59% and 2.19%, respectively.

The market’s negative reaction to the new virus cases continued this morning with Dow futures down more than 100 points in the pre-market but turned positive within the first hour of trading.

Currently, 26 states are reporting rising numbers of new coronavirus cases.  The increase in confirmed cases comes as many states begin to reopen certain businesses and some social gatherings.  Florida, for example, reported its highest one-day increase in coronavirus cases yesterday, an increase of more than 5,500 cases in the last 24 hours.

The Labor Department reported this morning than 1.4 million American workers applied for unemployment benefits, slightly higher than analysts had expected.  Today’s report does show a steady decrease in number of first-time unemployment filers.

Also dragging on the markets yesterday was a gloomy economic outlook released by the International Monetary Fund (IMF).  The IMF predicts that global growth in 2020 will fall by 4.9% and predicts growth in the U.S. will decline by 8%.

As of 7:30am PDT, all three major U.S. stock markets are in positive territory.