Markets React to Oil Prices
Greetings Eagle Wealth Community,
National Superhero day is April 28th. It usually means capes and superpowers, but this year it takes on a whole new meaning as we honor the real-life heroes in the medical field. We are so thankful for the selfless devotion of the nurses, doctors, technicians, transporters, EMTs, pharmacists and everyone across the country supporting patient care during the pandemic. Thank you!
Keep flattening the curve and take care of yourself and those around you. We’re here if you need us — please call if we can help.
Your Eagle Wealth Team
You’re Invited — Live Webinar
Given our goal to provide you with continued education, we invite you to join Chad Staskal, Managing Partner of Eagle Wealth Management, and the CEO of City National Rochdale, Garrett D’Alessandro, for a private webinar on the economic impact of COVID-19 and what to expect ahead.
This live webinar is exclusively for our Eagle Wealth community only. Don’t miss the opportunity to ask questions and hear directly from the CEO of a firm managing $45 billion in assets. Learn more at myeaglewealth.com/upcoming events or click below to register.
Wednesday, May 6th, 2020 At 2:00 Pm
The SECURE Act changed the landscape of investing. Most of the provisions took effect 1/1/2020 and some are unsure of how their retirement and investing strategies were affected. While the most drastic changes were made to retirement accounts, there are several other provisions that have also changed investment strategies for younger investors.
In our review meetings we’ll discuss how the provisions may affect you, but if you’d like to learn more now, read our SECURE Act whitepaper. Please call us if you have any questions.
Our resident jetsetter, Suzanne Daniel, has obviously been grounded. Her timing was perfect though for a new plan – a home staycation. Her multi-phase backyard transformation was completed just in time to enjoy margaritas on the patio or stargaze from the hot tub this spring. Finding joy in the comfort of home is one way to make the best of the circumstances, and she’s doing a great job. When life gives Suzanne lemons, she asks for tequila and salt!
You can view images of the full remodel here.
The Week on Wall Street
Stock prices bounced around last week as investors reacted to wild swings in the price of oil and reports that called into question the efficacy of two potential virus treatments.
The Dow Jones Industrial Average retreated 1.93%, while the Standard & Poor’s 500 lost 1.32%. The Nasdaq Composite Index slipped 0.18%. The MSCI EAFE Index, which tracks developed overseas stock markets, declined 1.21%.[i],[ii],[iii]
Oil Wavers, Promising Virus Treatments Disappoint
Stocks opened the new week lower on the heels of a plunge in oil prices that saw the May oil futures contract fall into negative territory. While negative prices were largely reflective of technical issues associated with trading the contracts rather than the actual price of oil, the unprecedented move unsettled investors.
Stocks found some positive momentum as the week wore on, buoyed by corporate earnings reports that showed solid performance amid a challenging environment.
On two separate days, however, solid moves to the upside were derailed by disappointing news on promising COVID-19 treatments. One drug failed to produce positive results in its first trial, followed the next day by an FDA warning against taking chloroquine and hydroxychloroquine to treat COVID-19. Stocks managed to rally and trim the week’s losses during the market’s final hours on Friday.
The Economic Reopening Begins
States across the nation, including Georgia, Tennessee, South Carolina, and Texas, have begun the process of slowly reopening commerce, while Montana’s governor announced the first phase of restarting its economy.[iv],[v]
Each state is taking a different approach, potentially serving as a laboratory to help guide other states in their efforts to reopen businesses. From the market’s perspective, these early steps are not only hopeful signs that the journey to normalization may have begun, but they may provide important clues to how quickly business activity can rebound and the degree to which individuals resume social engagement – two important metrics that may influence the market in the weeks ahead.
THIS WEEK: KEY ECONOMIC DATA
Wednesday: Gross Domestic Product (GDP). Federal Open Market Committee (FOMC) Meeting Announcement.
Thursday: Jobless Claims.
Friday: Purchasing Managers Index (PMI): Manufacturing Index. Institute for Supply Management (ISM) Manufacturing Index.
Source: Econoday, April 24, 2020
The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.
THIS WEEK: COMPANIES REPORTING EARNINGS
Tuesday: Advanced Micro Devices (AMD), Ford Motor Company (F), Pfizer (PFE), Caterpillar (CAT), Starbucks (SBUX), Merck & Co. (MRK), United Parcel Service (UPS), D.R. Horton (DHI)
Wednesday: Microsoft (MSFT), Facebook (FB), Boeing (BA), Tesla (TSLA), Qualcomm (QCOM)
Thursday: Apple (AAPL), Amazon (AMZN), Visa (V), McDonald’s (MCD), Gilead Sciences (GILD)
Friday: Exxon Mobil (XOM), Chevron (CVX), Clorox (CLX), Abbvie (ABBV)
Source: Zacks, April 24, 2020
Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Any investment should be consistent with your objectives, time frame and risk tolerance. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.
[i] The Wall Street Journal, April 24, 2020. The market indexes discussed are unmanaged and generally considered representative of their respective markets. Individuals cannot directly invest in unmanaged indexes. Past performance does not guarantee future results. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost.
[ii] The Wall Street Journal, April 24, 2020. The market indexes discussed are unmanaged and generally considered representative of their respective markets. Individuals cannot directly invest in unmanaged indexes. Past performance does not guarantee future results. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost.
[iii] The Wall Street Journal, April 24, 2020
[iv] US News & World Report, April 21, 2020
[v] US News & World Report, April 22, 2020