Market Summary

Normal service was resumed this week with equity markets back in the green and Tech stocks leading the charge.
60% of the S&P 500 companies have now reported Q2 earnings, 82% of these companies have exceeded expectations, led by Technology, Materials, Health Care, and Industrial, albeit at severely depressed expectation levels. Despite the lower hurdle, this better-than-expected earnings season boosted markets this week.
GDP figures released this week saw the U.S economy shrink 32.9% on an annualized basis in Q2, the largest drop since records began back in 1947.


1.8%S&P 500

Tech Stocks were back in the driving seat this week as quarterly earnings from the major tech players of Apple, Alphabet, Amazon, and Facebook all exceeded analysts’ expectations.



The U.S. dollar fell to its lowest point in a decade. The currency slide could well continue as a resurgence in coronavirus numbers ,slowing business activity and a faltering U.S. economy looks set to weigh on the Global currency of choice.

Bond Yields


The 10Y U.S. Treasury yield slipped further this week. The FED reaffirmed its commitment to supporting the U.S. economy this week, keeping interest rates unchanged and extending their lending programs until the end of the year.



Gold soared to nearly $2,000 per ounce this week. This store-of-value play continues to gain traction as the $4 trillion of fiscal stimulus raises the possibility of future inflation. If the currency debasement continues, so too will the inflation hedge allocation to Gold.



Market Outlook

May and June saw a cumulative jump in consumer spending of nearly 14% following a sharp decline earlier in the year. Now, the longevity of this positive trajectory is being threatened by rising COVID-19 cases and slowed reopenings in certain states.

The congressional debate around a phase 4 fiscal stimulus package continued in vain last week despite the additional $600 per week unemployment benefit expiring on Friday. A considerable divergence between both parties still exists with a lack of common ground around significant issues such as the size and duration of the unemployment benefit. With no compromise in sight, this uncertainty will serve as a critical blow to an economy desperate for stability and support, with short-term consumer spending likely to be curtailed until a resolution is found.