The S&P 500 (Index: SPX) continues to defy gravity in the upside down market the Fed has wrought, closing the trading week ending on 24 April 2020 at 2,836.74, 599.34 points (21.1%) above its 23 March 2020 coronavirus recession low, and 549.10 points (16.2%) below its 19 February 2020 pre-coronavirus recession high, giving an indication of the extreme volatility that has characterized the stock market during the last two months.
The alternative futures forecast chart shows the level of the S&P 500 is consistent with an amplification factor m in the dividend futures-based model being equal to -1 following the Fed's last action to backstop the liquidity of the commercial bond market.
Dividend futures have also been rebounding, which in today's upside down market, means that the expected future level of the S&P 500's quarterly dividends per share won't be as low as they were projected a month ago when the market hit bottom.
Here's the wrap-up of the market-moving news headlines we tracked during the past week.
- Monday, 20 April 2020
- Signs and portents for the U.S. economy:
- Oil crashes, ends negative for the first time in history
- With Congress feuding, a small business deal seems elusive
- North America extends coronavirus travel restrictions: U.S. official
- Some life insurers hit pause on older Americans during coronavirus crisis
- Bigger stimulus, handouts developing in the U.S.:
- Restaurants: U.S. restaurants seek more aid, on track to lose $240 billion by end of 2020
- Airlines: United Airlines sees $2.1 billion loss as coronavirus hits Latin America growth hopes, seeks more federal aid
- U.S. senators propose $500 billion rescue for state, local governments
- Bigger trouble developing all over:
- IMF's Georgieva says coronavirus crisis is worst since Great Depression
- Italy sees its virus-hit economy falling 8% in 2020: sources
- China's fiscal revenue plunges 26.1% as virus ravages economy
- Bigger stimulus developing in China, not so much in the Eurozone:
- China cuts key rate for second time this year, more easing likely
- ECB will do more if needed to keep prices stable: Villeroy
- Wall Street drops as oil traders cannot give away U.S. crude
- Tuesday, 21 April 2020
- Collapsing global oil prices:
- Brent oil futures plunge as growing glut feeds market panic
- Trump to consider halting Saudi oil imports, says U.S. has 'plenty'
- Oil price plunge below zero sends 'oil tourists' on wild ride
- A hunt for any storage space turns urgent as oil glut grows
- Bigger trouble developing in Eurozone, China finding their bigger stimulus isn't delivering their desired results:
- European new car sales plunge by 51.8% in March due to coronavirus: ACEA
- As China splashes out vouchers to revive retail, many just buy necessities
- Australia to suffer a 'once in a century' economic contraction: central bank governor
- Bigger stimulus developing in the U.S.
- U.S. Senate passes nearly $500 billion coronavirus bill aiding small business
- U.S. Treasury releases $2.9 billion in airline support, finalizes payroll agreements
- Strained U.S. mortgage firms get support but push for liquidity facility
- ECB minions continue calling for 'Pan-European' response
- Pan-European response needed in Coronavirus crisis: ECB's Knot
- Euro zone fiscal response to crisis inadequate: ECB's Panetta
- Fed minions concerned state and local economy lockdowns harming U.S. economy:
- Wall Street tumbles as oil crash adds to pandemic fears
- Wednesday, 22 April 2020
- Signs and portents for the U.S. economy:
- Brent crude rebounds from more-than 20-year low; U.S. oil up 20% in wild trade
- U.S. auto sales show signs of life after gloomy coronavirus March: J.D. Power
- Coronavirus to spur largest single loss in insurance history: Chubb CEO
- Bigger trouble developing in the Eurozone:
- Euro zone economy set for deepest recession on record: Reuters poll
- Lagarde draws line on how far ECB largesse can go
- Still bigger stimulus developing in China:
- EU minions wonder what to do about bigger trouble:
- EU 'misunderstandings' push back deal on coronavirus economic recovery
- ECB's Rehn: EU leaders must show solidarity with coronavirus package
- Explainer: How the EU can finance economic recovery after the COVID-19 pandemic
- German government wants to launch tax relief worth 4.5 billion euros: newspaper
- Wall Street surges as Congress preps more stimulus and oil bounces back
- Thursday, 23 April 2020
- Oil rallies on faster output cuts to offset virus-induced falloff in demand
- Bankruptcy looms over U.S. energy industry, from oil fields to pipelines
- U.S. new home sales tumble in March
- Millions of Americans join unemployment line as coronavirus savages economy
- Bigger trouble in the Eurozone, Japan:
- Euro zone business activity ground to a halt in April: PMI
- ECB's Lagarde tells EU leaders: coronavirus can cut 15% of output: source
- ECB warns EU leaders of doing too little, too late about coronavirus effects
- Japan offers bleakest view of economy in over a decade as virus damage deepens
- Bigger stimulus developing in China, Eurozone:
- China President Xi says to boost investments, employment
- EU lays out trillion euro escape route from coronavirus pandemic
- Wall Street trims gains after report on coronavirus drug trial
- Friday, 24 April 2020
- Signs and portents for the U.S. economy:
- Oil rises, but ends wild week lower as coronavirus slashes fuel demand
- As U.S. coronavirus death toll tops 50,000, handful of states edge toward reopening
- Insurers feel the heat as chefs, Trump join calls for payouts
- Trump signs fourth coronavirus relief bill into law, pushes back against USPS aid
- Congressional estimators see major U.S. economic decline in mid-2020 as coronavirus stifles activity
- Bigger trouble developing in Eurozone:
- Bigger stimulus still developing in China:
- ECB, EU minions at odds on coronavirus pandemic relief:
- Indecisive EU to force ECB into more emergency action
- ECB's de Cos calls for common actions to address budgetary risks at EU level
- ECB begins reluctant journey into junk debt
- Tech titans Apple and Microsoft propel Wall Street rally
But wait, there's more! Barry Ritholtz listed the positive and negative news he picked out of the week's news stream to provide a bigger picture than what we've presented!
Unlike the weeks preceding it, the trading week ending on Friday, 24 April 2020 was relatively subdued. So much so that unless we see daily volatility rise to an interesting level, which we define as a greater than 2% change in either direction from the previous day's closing value, we'll discontinue appending daily updates throughout the week to this article. If the market should change by more that 2% from one day to the next in the trading week ending Friday, 1 May 2020, please follow this link for our unscheduled 'below the line' coverage the following morning.
S&P 500 Rises 2.7% As The Fed Works Its Mojo
Update 29 April 2020, 6:30 PM Eastern: The S&P 500 (Index: SPX) climbed 2.7% to close at 2,939.51 as all eyes were on the Fed and what signal it would send for providing relief for coronavirus-stricken markets.
And they signal they sent was that the Fed will be "committed to using every tool", which is to say they are going to continue doing what they have been doing, and more of it.
In addition to sending stock prices higher, that message also sent dividend futures higher. Here are the latest versions of the S&P 500's dividend futures and the alternative futures chart, where we find the trajectory of the S&P 500 is following the new upside-down order the Fed has created in the stock market.
In other news, the coronavirus recession crashed U.S. GDP by at least 4.2% in the first quarter, with virtually all of it in March 2020, and U.S. firms are cutting or suspending dividend payments at never-before-seen rates. How long do you suppose the Fed will need to keep working its monetary mojo?
Welcome to the blogosphere's toolchest! Here, unlike other blogs dedicated to analyzing current events, we create easy-to-use, simple tools to do the math related to them so you can get in on the action too! If you would like to learn more about these tools, or if you would like to contribute ideas to develop for this blog, please e-mail us at:
ironman at politicalcalculations
Thanks in advance!
Closing values for previous trading day.
This site is primarily powered by:
CSS Validation
RSS Site Feed
JavaScript
The tools on this site are built using JavaScript. If you would like to learn more, one of the best free resources on the web is available at W3Schools.com.
Other Cool Resources
Blog Roll
