Winthrop Partners Weekly Update 6-15-2020

The Markets (as of market close June 12, 2020)
Last week began with a bang for stocks as each of the indexes gained well over 1.0% for the day. The S&P 500, after climbing 1.2%, has picked up nearly 45.0% since its 2020 low, pushing it into the black for the year. The Nasdaq rose to a record high while the Dow and Russell 2000 surged by close to 2.0% each. Oil prices fell marginally, and the dollar sank, as did the yield on 10-year Treasuries. Investors were encouraged by the prospects of more reopenings, the Federal Reserve’s expansion of its Main Street Lending Program, and the growing sentiment that the economy is reversing course toward expansion. Market sectors leading the way included energy, real estate, airlines, financials, travel and leisure, and retail.
Investors pulled some profits out of stocks last Tuesday, sending each of the benchmark indexes (except the Nasdaq) lower. The Dow fell 1.1%, and the S&P 500 dipped 0.8%. The tech-heavy Nasdaq edged up 0.3% and reached 10,000 for the first time in its history, only to fall back slightly by the end of trading. Oil prices rose, the yield on 10-year Treasuries dropped, and the dollar declined for the ninth straight day.
Equities fell again last Wednesday despite the Fed’s announcement that it would maintain the current target rate range at 0.00%-0.25% and continue to make asset purchases at the current pace. The Dow dropped 1.0%, the S&P 500 lost 0.5%, but the Nasdaq continued to climb, gaining 0.7%. For the first time in several sessions, FAANGs (Facebook, Apple, Amazon, Netflix, and Alphabet Google) posted gains, along with health care and tech stocks.
Stocks plunged dramatically last Thursday as investors sold stocks on news of rising COVID-19 cases coupled with the Federal Reserve’s assessment that the economy will be slow to recover. Each of the indexes listed here fell by at least 5.27%, with the Russell 2000 dropping 7.58% and the Dow plummeting 6.90%. Yields on 10-year Treasuries sank, as did crude oil prices.
Equities rallied from Thursday’s rout, but not enough to prevent an overall week of losses. Stocks posted solid returns last Friday with each of the benchmark indexes listed here posting solid daily gains, led by the Russell 2000, which climbed more than 2.25% on the day. Crude oil prices inched up, as did the yields on 10-year Treasuries.
However, the week was marked by fears of a second virus wave, which sent equities into a tailspin. While stocks rallied Friday, the major indexes lost ground for the week. The small caps of the Russell 2000 were hit the hardest, followed by the Dow, Global Dow, the S&P 500, and the Nasdaq. Year to date, only the Nasdaq remained solidly in the black, while the Russell 2000, the Global Dow, and the Dow continue to lag by more than 10.0%, respectively. Investors exercised caution in light of rising COVID-19 infection rates and an uncertain economic outlook.
For the first time in several weeks, crude oil prices fell, closing the week at $36.41 per barrel by late Friday afternoon, down from the prior week’s price of $39.16. The price of gold (COMEX) soared last week, closing at $1,738.40 by late Friday afternoon, up from the prior week’s price of $1,688.30. For the sixth week in a row, gas prices rose. The national average retail regular gasoline price was $2.036 per gallon on June 8, 2020, $0.062 higher than the prior week’s price but $0.696 less than a year ago. Click here for more:Winthrop Partners Weekly Update 6-15-2020