Worst Q1 Ever

Disastrous Quarter Ends With A Small Selloff This week has been calm so far. S&P 500 fell 1.6% and the VIX fell 3.54 to 53.54 on Tuesday. We can expect the VIX to fall even on down days. Panic can’t last forever. It is a short emotional outburst. If stocks fall, they won’t crash like…

Dividend Cuts & Spiking Unemployment

Dividend Cuts Coming Fast & Furious As of March 30th, 24 companies suspended their buyback programs in 2020 for a total of over $200 billion. Financials have led the charge with $127 billion in cuts. Financials probably have led the charge because of their energy loans. Obviously, the entire economy is in a recession, but…

Stock Market Recovery Continues

Another Rally Yes, technically Monday’s rally followed a decline on Friday. But the fact that stocks increased feels like we are in a winning streak since we didn’t get closer to last Monday’s low. S&P 500 has increased in 5 of the past 6 trading days. It just missed reversing the entire selloff on Friday.…

Hiring Is Down 15% Because Of COVID-19

Hiring Slows In a shock to no one, the data shows hiring is slowing. The only companies that are hiring are the ones seeing more demand because of COVID-19 which is a select few. In this bucket you have necessities like groceries and healthcare. You also have online retail, but even Amazon is running into…

No Liquidity In This Market

Best Rally Since 1931 Ends The stock market just had its best 3 day span since 1931. Gains were enormous off the low on Monday. It’s no surprise that stocks took a breather on Friday. Even if you’re a bull, you had to expect that to happen. Many were hoping for a down day with…

Jobless Claims To Increase Further Next Week

Jobless Claims In Context Jobless claims are measured nominally, which means comparing them to the past isn’t apples to apples. Before COVID-19, claims were very low on a nominal basis and extraordinarily low on a population adjusted basis. It was by far a new record low. Now, we are in the opposite situation as claims…

Biggest 3 Day Rally Since 1931

Another Huge Rally The stock market has been on a rampage. It’s now up about 19% from the trough on March 23rd. Dow is up almost 23% which catalyzed the Wall Street Journal to say a new bull market is here. It's unlikely that 3 days of rapid gains makes a bull market. Even if…

Record Jobless Claims (30 Sigma Event)

Where Will Earnings End Up? Some investors are completely ignoring where 2020 earnings will be because recessionary earnings are a temporary dip. Other are calling for the end of the world because earnings are crashing. Some are in between. We should be looking closely at earnings. It gives us a guide as to how low…

Stocks Stabilize On Hopes Of Fiscal Stimulus

Markets Are Normalizing Markets are finally normalizing. That sounds weird because the 1 month and 3 month treasury bills fell to slightly negative yields. However, it's because Wall Street is starting to get its arms around COVID-19 and markets are moving less wildly. VIX was actually up on Wednesday as it rose 2.28 to 63.95.…

Fed Saves The Day

Beginning of Earnings Season The start of Q1 earnings season has been good because the firms reporting earnings ended their quarter at the end of February. They barely had any impacts from COVID-19 in their reports. This would have been a great quarter for firms if COVID-19 didn’t spread widely. With the first 14 firms…

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