April 9, 2020 Weekly Market Recap

A monster week for stocks! The market rallied during the past week as investor sentiment continued improving while the Federal Reserve announced more aggressive action. The S&P 500 gained 12.1% while the Russell 2000 (+18.5%) outperformed.

The advance was interrupted by a pullback on Tuesday, but the next two days saw the S&P 500 climb to its best level in nearly a month. All eleven sectors recorded gains of more than 4.5% with real estate (+21.2%), materials (+20.7%), and financials (+19.1%) leading the way.

A lot of the market’s optimism of the past week was due to expectations that the peak of the coronavirus outbreak is imminent. However, the latter portion of the week saw more news regarding stimulus plans. House Speaker Nancy Pelosi told Democratic lawmakers that she wants the next spending package to be at least $1 trillion while Treasury Secretary, Steven Mnuchin, said that airlines will be the beneficiaries of the next aid package.

On Friday, the Federal Reserve introduced another $2.30 trillion in emergency lending capacity for businesses and municipalities. The central bank will now begin purchasing junk bond ETFs and collateralized loan obligations.

Next week will bring the start of the Q1 earnings season with large banks like JPMorgan Chase (JPM), Wells Fargo (WFC), and Citigroup (C) set to report their results between Tuesday and Wednesday.

Happy Easter!!!!!

Source: Briefing Investor