May 1, 2020

Happy May Day,

Following March’s historic stock market decline into bear territory, April’s double-digit rebound was certainly welcomed by all investors.  For the month, the Dow gained 11.1%, S&P 500 was up 10.9% and the NASDAQ gained 15.5%.  As stated on almost a daily basis, the market has focused on the success of controlling the coronavirus and the reopening of the U.S. economy, one state at a time.

All eyes are on the states that are reopening first to see if there is a resurgence of the virus as businesses open and people come out from the shelter in place orders.  This, coupled with most rapid testing and anti-viral medications in development, is giving hope that we are seeing the backside of the coronavirus growth curve.

Corporate earnings are the topic of today, with somewhat weak reports from Apple and Amazon driving big tech down.  There may also be a bit of profit taking after such strong performance in April.  The Dow has spent most of this morning down between 300 and 400 points.

We expect to see continued volatility in the U.S. stock markets going forward, especially on the release of corporate earnings and unemployment reports for the foreseeable future.  As the title of an article we recently reposted implies – DON’T TOUCH YOUR FACE OR YOUR PORTFOLIO – this is probably not a time for dramatic portfolio adjustments.  Such adjustments at times like this are usually the results of an emotional reaction to some event or perceived future occurrence.  Rather than react, talk to us first.

Have a wonderful and healthy weekend.