Weekly Market Commentary

June 3, 2020

 

The Markets

Are those green shoots?

In economic terms, green shoots are signs of improvement. If you were paying close attention, you might have seen some in economic data released last week.

The Congressional Budget Office (CBO) estimated:

“…from March 21 to March 31, when many social distancing measures were in place, spending may have been down by almost 28 percent as a result of the pandemic; spending on accommodations and restaurants declined by 60 percent to 80 percent; and spending for some goods (such as clothing) dropped by similar amounts.”

Spoiler alert: The numbers for the second quarter are expected to be worse. However, economic growth is expected to bounce as consumer spending, which accounts for two-thirds of GDP, resumes.

The green shoots were found in unemployment. As businesses reopened and shelter-in-place orders eased, the U.S. unemployment rate dropped to 14.5 percent during the week of May 16 from 17.1 percent the previous week, according to the Department of Labor.

Green shoots were also sprouting from the University of Michigan’s May Consumer Sentiment Survey, which reported: “…a growing number of consumers expected the economy to improve from its recent standstill…” The Index of Consumer Sentiment ticked higher from April to May.

I have been re-blending to increase the stock holdings due to these trends and research calls that I have been on. The goal is long term not the next quarter which will be mainly affected by virus issues.

FYI: It’s June! One side effect of COVID-19 quarantine is losing track of days. When routines are disrupted and recurring activities that distinguish one day from the next are discontinued, it can be difficult to know whether it’s Monday or Thursday.

Fortunately, the United States has enough national holidays to clearly delineate one day from the next. Here is a list of some June holidays to help you keep track of days:

June 1: World Reef Awareness Day

June 2: National Bubba Day

June 3: National Running Day

June 4: National SAFE Day

June 5: National Doughnut Day

June 6: D-Day – remembering the day Allied troops landed on the beaches of Normandy

June 7: National Cancer Survivor’s Day

June 8: National Best Friends Day

June 9: National Earl Day

June 10: National Iced Tea Day

June 11: National Making Life Beautiful Day

June 12: National Loving Day

June 13: National Kitchen Klutzes of America Day

June 14: National Flag Day and the Birthday of the U.S. Army

June 15: National Smile Power Day

June 16: National Fudge Day

June 17: National Eat Your Vegetables Day

June 18: National Go Fishing Day

June 19: Juneteenth – commemorating the end of slavery

June 20: Summer Solstice – the start of summer in the Northern Hemisphere

June 21: Father’s Day – celebrating dear old dad

June 22: National Chocolate Eclair Day

June 23: National Pink Day

June 24: National Parchment Day

June 25: National Leon Day

June 26: Take Your Dog to Work Day

June 27: National PTSD Awareness Day

June 28: National Logistics Day

June 29: National Waffle Iron Day

June 30: Social Media Day (As if that weren’t every day!)

I have no idea who makes these up but every day is booked!! Let me know what’s your favorite! By the end of June, we should be on our way to a new normal and able to use the coronavirus lockdown as a point of reference for tracking events.

Focus On The Positive

“Give peace a chance”  -John Lennon

 

Best regards,

Bill Spalding