July 1, 2020

The world continues to be embroiled in the various implications of COVID 19 and its effects on the national and global economies. We expect economic activity to resume at a painfully slow pace as businesses cautiously reopen.

The S&P 500 and Dow posted gains for the month of June. The Nasdaq Composite outperformed amid a broad tech rally, with the index pacing toward a monthly advance of more than 5.3%.

As a result of the latest events from COVID 19, we expect to see greater investment in the digital economy where more workers will be reducing their commute and working from home offices and the amount of online purchases of everything from cars to groceries accelerating.

The sales report for May showed that the health of the U.S. consumer amid one of the worst global pandemics in modern history was surprisingly good. Consumer spending rebounded in May following April’s record plunge. Online sales maintained their strength and spending in the beaten down core components rebounded sharply during the month.

Contracts to buy existing homes rebounded by the most on record in May, suggesting the housing market was starting to turn around after being hammered by the COVID 19 pandemic along with the rest of the economy.

The National Association of Realtors reported its Pending Home Sales Index, based on contracts signed last month, surged 44.3% last month, the largest increase since the series started in 2001, to 99.6.

Year to date the Dow and the S&P 500 remain negative at -9.55% and -4.04% while the Nasdaq is positive 12.11%. The 10-year Treasury is currently yielding 0.64%.

*Disclaimer: This report is a publication of Marchand Faries Financial Management, Inc. Information presented is believed to be factual and up-to-date, but we do not guarantee its accuracy and it should not be regarded as a complete analysis of the subjects discussed.  All expressions of opinion reflect the judgement of the author as of the date of publication and are subject to change.