Daily Covid and Markets - Tuesday August 4
The Dividend Cafe
The Dividend Cafe - The Bahnsen Group
4.9 • 572 Ratings
🗓️ 4 August 2020
⏱️ 21 minutes
🔗️ Recording | Apple Podcasts | RSS
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Summary
The market was up 164 points today, though the % move up in the S&P and the Nasdaq was less. There was a little move up to start the day, then a flat range for most of the day, followed by a dip, and then a rally into the close. My own feeling is that investors are a little hesitant to be unexposed into a close out of fear that a stimulus deal may get announced while markets are closed … (it isn’t impossible, but I doubt that it is imminent).
The “hurricane” set to come through NYC turned out to be a rain shower, and something tells me this won’t be the last time a doom & gloom prediction for New York City turns out to be wrong this year.
Speaking of NYC, they have LESS THAN a 1% positivity rate right now with high levels of testing, and that positivity rate has been less than 2% for almost two months! Their new cases are almost not registering at all (57 yesterday, same as some small towns in the midwest). Hospitalizations were just 15 yesterday – again, 15 is a fraction of what towns 1/100th the size are experiencing. And mortalities have been zero many days recently, and not more than ten in a day for several weeks.
So I am pleased to see all of this in NYC, and hopeful that it leads to steps towards economic revitalization, not the opposite. Now, with NYC’s health status out of the way, let’s jump everywhere else we normally go.
Links mentioned in this episode: DividendCafe.com TheBahnsenGroup.com
Transcript
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| 0:00.8 | Welcome to the Dividing Cafe weekly market commentary focused on dividends in your portfolio and dividends in your understanding of economic life. |
| 0:12.8 | Hello and welcome to today's COVID and markets podcast brought to you by the Dividing Cafe of the Bonson Group with our Tuesday COVID update. |
| 0:25.4 | First of all, just quickly on the market front today, August the 4th, the Dow was up |
| 0:30.5 | 164 points and that actually was a higher percentage move up than either the S&P or the NASDAQ. |
| 0:37.0 | But all three market indices were up. |
| 0:39.9 | There was a little move out of the gate this morning to the upside. |
| 0:44.7 | And then we were kind of flat the most of the day. |
| 0:46.7 | We dropped a little bit. |
| 0:48.6 | But then off of that drop had a big rally into the close. |
| 0:53.1 | My overall feeling is that you're getting rallies near the end of the day |
| 0:58.0 | for the same reason that sometimes you get sell-offs at the end of the day, |
| 1:02.4 | which is the desired exposure of investors overnight. |
| 1:07.7 | Sometimes they desire to not have risk exposure |
| 1:10.7 | out of fear of a particular news |
| 1:13.2 | development going against them. That's certainly more common. That can apply over the weekend as well. |
| 1:20.8 | It's applied on overnight basis many times. The kind of logic of that has applied many times this year. But right now, I think |
| 1:30.3 | the sort of the inverse thinking, which is that some investors appear to me, whether it be a |
| 1:38.5 | weekend or overnight, to be a little bit hesitant to not be exposed to risk at fear that a stimulus announcement could come |
| 1:47.4 | and and then you get a gap up that unexposed investors would be missing. It's not it's not |
| 1:54.8 | impossible. It's not totally illogical. I am pretty confident by the way and that is in what |
| 2:00.4 | what's going on. |
| 2:01.5 | But I don't think a deal is necessarily imminent, but nevertheless, fear of such a thing certainly makes sense. |
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