The US stock markets (as measured by the S&P 500) was down 0.2% last week, bringing it down to 11.8% YTD. For the month of April, the S&P 500 12.7%, investors in well-diversified portfolios can expect to see “friendlier” April statements.
So what’s going on out there? We all see and hear the news, as it seems apparent that the worst is behind us (assuming a second wave of the virus doesn’t hit us the same or worse as the first wave). Now, the struggle, (which also seems somewhat political) is when to let people return to work and get the economy going again. Each of the last four weeks have shown extraordinarily and historically high unemployment claims, quickly raising the unemployment number into double digits, a stark contrast from the lowest unemployment figures we’ve seen in over 50 years before the pandemic began. As the economy begins to start again, the adverse impact from COVID-19 may become more and more defined.
Over the past several days, some economists have expressed concern that this work outage may have a far greater impact on the economy, and that has put pressure on the markets in the past few trading days. On the bright side, it appears that the pharmaceutical companies are close to developing a vaccine, as well as a drug that could treat the symptoms of the virus. Together, these could reduce the adverse impact of the virus, and hopefully allow the economy to get started again.