The week on Wall Street
Stock prices ended the week slightly lower, despite news of positive results from a test trial of a COVID-19 drug treatment and several states easing their economic lockdowns.
The Dow Jones Industrial Average slipped 0.22%, while the Standard & Poor’s 500 lost 0.21%. The Nasdaq Composite Index dropped 0.34%. The MSCI EAFE Index, which tracks developed stock markets overseas, rose 4.34%.1,2,3
Light at the End of the Tunnel?
Investors were emboldened last week by two significant developments: a quickening in the pace of state re-openings and positive results from a clinical trial of pandemic treatment. These developments turned investor focus toward economic normalization and away from the economic destruction that has occurred.
Market optimism was also supported by earnings reports early in the week, which showed that some companies were navigating reasonably well through the crisis. But stocks retreated on Friday as traders reacted to mixed earnings from two tech titans. The two firms offered a reminder that even the strongest companies have not escaped the economic impact of the pandemic.
Worries over possible new China trade tariffs also weighed on stocks as the trading week came to a close.
Corporate Earnings
It was a busy week for corporate earnings reports. So far, the earnings season has been mixed; it has provided some clarity, though, about the impact of COVID-19 on businesses.
With 193 of S&P 500 companies reporting, 65% have checked in with results ahead of consensus Wall Street estimates. Among the better-performing sectors to date were Technology and Consumer Staples. Financials were among the laggards.4,5,6
Final Thought
Despite the continued shutdown of businesses nationwide, stocks staged a powerful rebound in April, leading some to wonder if Wall Street is disconnected from Main Street. But market watchers are quick to point out that Main Street may not be as disconnected as it appears. April’s rally was led by a group of very large companies, with over 75% of stocks in the S&P 500 trading below their 200-day moving average.7
I was on Fox Business last week discussing the markets and economy during these difficult times
Listen to Ken’s coronavirus Q&A show on WHUD radio now!
Click here and listen to Ken’s 01/26/2020 segment to hear about the best way investors can stay up-to-date on market news, how to make retirement dollars last, as well as different risk and reward management techniques that can be used by all investors.
In this segment, Ken discuss certain strategies to consider through a choppy market, and highlights how a stop loss order can help reduce risk and maintain a sell discipline. Ken takes ideas from his new book ’10 Things To Do Before You Retire’ to answer questions on how to stretch dollars through retirement, and what the best resources are for all investors to stay in tune with the markets and wider economy.
We are donating to help fight the coronavirus pandemic!
Here at Mahoney Asset Management we think it is important to give back and support our local communities at this time of need. As a result, we are donating to the United Way of Westchester and Putnam coronavirus response efforts.
Our donation will help support Westchester and Putnam County families in crisis and will provide lifesaving resources to people impacted by COVID-19. 100% of the donation will remain in Westchester and Putnam counties to provide essential resources, including food and medical supplies, as well as help continue to provide important Coronavirus information to the communities.
If you would also like to contribute and help our local communities in the fight against coronavirus, click here.
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