Watch the CPK Market Action Report: July 2020

As Covid 19 infections set new records in multiple states, the market continues to focus on the strength of big business. How much longer can the growing number of cases be ignored?

Watch the full 3-minute Market Action Report now: 

July 2020

Stocks notched a solid gain in June, overcoming a rise in COVID-19 cases and fears of a slowdown in economic reopenings

The Dow Industrials added 1.7 percent, while the S&P 500 picked up 1.8 percent. The NASDAQ Composite led, gaining nearly 6 percent.

Stocks climbed higher on a steady diet of positive news, including a report of an effective COVID treatment for critically ill patients and talk of more fiscal stimulus.

Markets reversed late in the month on a surge of new infections in Florida, Texas, and California. Some states rolled back reopening plans, which rattled traders. 

But stocks closed out the month posting back-to-back gains to cement a solid showing.

Assessing the economy has become more difficult due to the uncertainties caused by the pandemic.

For example, May’s employment report showed the economy added 2.5 million new jobs. Wall Street economics were far off, predicting a drop of 8.3 million.

Economists are expected to look for more creative ways to measure activity, so they are increasingly turning to real-time data. For example, restaurant apps can help show whether people are returning to social settings.

Traditional economic indicators remain vital but expect a growing focus on newer, “big data” tools that give critical real-time snapshots.

As I stand here today, our technical indicators are still showing cash and fixed income in the top two dominant positions with Domestic Equities in the third position. Why, you ask? As of last week, only about 30% of stocks in the S&P 500 were positive for the year with 50% of those only up single digits. Folks, that’s one heck of a ride since March to only be up single digits.

Although we are still in cash, let me be clear about how our indicators work. When a category is positioned outside of the top two rankings, it does not mean one can’t make gains in any investment. They can! It simply tells us that we are no longer on offense and that defense would be a more appropriate allocation for the time being.

As a reminder, my current allocation is not a recommendation. I still expect heavy volatility to continue for some time. Successful navigation through this environment will definitely require a fluid plan with all hands-on deck.

Regardless of what happens next, investors like you need to have a simple and yet solid financial plan that reduces RISKS, COSTS and TAXES while securing the necessary income you need to maintain your lifestyle throughout retirement.

If you don’t have a plan OR you’re not comfortable with the plan you have, call me today to get pointed in the right direction.

I’m Chad Kunc and that puts a wrap on the June 2020 Market Action Report. Thanks for joining me. It’s time for me to get back to the markets.

And that action starts, NOW!