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The Dow Jones Industrial Average (30 of the biggest stock in America) experienced an 1861 (6.9%) correction yesterday, as the markets responded to increased COVID-19 numbers over the past 4 days. Especially hard-hit areas including Texas, California and Georgia are seeing the dreaded “second wave” with infection trends at or near infection rates from the first wave.
The stock market is up 300 (1.3%) so far this morning.
The markets were especially spooked yesterday as concerns that a second wave of Coronavirus cases could upend consumer confidence, raising the prospect of a fresh round of social-distancing restrictions or layoffs.
In hindsight, the resurgent market of the past 5 weeks may have gotten ahead of itself. This is a reminder that the combination of a pandemic, oil surplus and recession will take some time to work through. We expect continued volatility over the next 5 months.
On the bright side of economic data, the past several weeks have been stronger than expected as businesses reopen and an increased number of folks going back to work. We continue to be very optimistic about America’s ability to overcome this economic situation. It probably takes a bit longer than we would like.
If you have any questions or concerns, please contact us anytime.