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…

Biggest Dow Gain Since 1933 (5th Biggest Ever)

Insane Tuesday Rally This market never ceases to be interesting as COVID-19 has caused a huge spike in volatility unlike anything most have in our lifetime. This is similar to 1929 except this won’t lead to an elongated depression. It’s possible that Q2 GDP growth is worse than the Great Depression, but there will be…

Everyone Is Buying Groceries & Holding Chinese Stocks

Absolute Madness At Grocery Stores Sales at grocery stores and companies that sell products and services that help people work from home are experiencing hyperbolic demand. Their products and services are like an inverse chart of the Dow in the past month. This is like if the entire country was about to experience a snowstorm…

Fastest 30% Decline Ever

Another Selloff Even though this has been a painful selloff, Monday’s decline was the first back to back selloff in a while. The market had alternated between red and green days for 7 days. It’s now down 33.9% from peak to trough, making this the 5th worst bear market since 1946.  As you can see from…

Unemployment Rate Could Spike To 12.8%

Extreme Negative Events Being Priced In Good news is everyone knows the Thursday jobless claims report will have well over 1 million claims which is the most ever by far. Bad news is it will likely happen. This negative event is probably priced in, but it’s still potentially the worst hit to the labor market…

Ruthless Bear Market Continues

New Bear Market Low Friday felt like an awful day for stocks because we hit a new bear market low. It looked possible that we could have the first back to back gains since early February, but that didn’t work out. It has been 26 days since we’ve had back to back gains which is…

Depression Predictions Get Worse (Yes That’s Possible)

S&P & IHS Markit Are Very Bearish The stock market is beginning to price in a depression. It’s unfortunate for investors that this bear market is not complete. But we need to see at least a 40% decline in the S&P 500 before we say a depression is mostly priced in. If the economy only…

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