7/8/20 Market Notes
Markets faded yesterday afternoon, giving back Monday’s gains after five consecutive positive days. Virus sensitive sectors and names were most impacted in a risk-off trade driven by concerns that the recovery is at risk of stalling. Negative sentiment was tempered by a surprisingly strong JOLTs report from the Labor Department, indicating that job openings are plentiful and demand for labor is intact. The S&P 500 dropped 34 points (1.1%) to 3,145, the Nasdaq shed 90 points (0.9%) to 10,344, and the Dow fell 397 points (1.5%) to close at 25,890. Consumer Staples was the only positive S&P sector while Financials and Energy were the biggest decliners. Tensions with China and uncertainty regarding the future of Hong Kong also weighed on sentiment, nudging safe haven assets higher. Treasuries and the dollar gained ground with the 10 year yield falling to 65 basis points; and the Bloomberg gold spot price increased by $12.15 an ounce to $1,796 per troy ounce, its highest level since August of 2011. Investors are expecting today’s crude oil inventories report to confirm that demand remains weak even with commuters starting to return to work as fewer Americans are on the roads for summer vacations. Tomorrow’s unemployment report remains the key datapoint for the week and is expected to show initial claims falling to 1.375 million with a 340k drop in continuing claims. Asian markets other than China were mostly lower overnight. European stocks are down, but off their lows, as their trading day nears the close; and US futures are flat.
Disclosures: This market commentary is written by the 1879 Advisors® and represents the views of 1879 Advisors®. This commentary is not investment advice and should not be used as a basis to make investment decisions. Please consult with your registered investment advisor before making any investment decisions.