May 11, 2020

Good Monday morning,

The U.S. equity markets ended last week with a powerful rally on Friday, May 8, sending the Dow, S&P 500 and NASDAQ up 454.42 (+1.91%), 48.61 (+1.69%) and 141.66 (1.58%) points, respectively.  Bonds, which tend to be negatively correlated to stocks, finished the week down about 1/3%.

Adding to a more stable background is the price of oil, nearly doubling from its recent lows.  Now in the range of $25/barrel, a further price recovery will help certain industries regain their financial footing.  With some areas beginning to reopen their economy, the demand for oil products – namely gasoline – should further help stabilize the oil markets.

This week, all eyes will be on the reopening of the U.S. economy – one state at a time – seeing if there is a renewed spike in coronavirus cases.  Gilead Sciences continues its production of Remdesivir, and asking assistance from other drug makers to ramp up production.  We hope to hear soon from Pfizer about the human trails it recently began.  Getting an effective, available and affordable treatment is likely to help the general economy reopen, as well as the longer-term benefits of a vaccine.

Have a great week.