Today, I'd like to discuss the coronavirus, including the economic and market implications. We’ve had some setbacks on the pandemic front this week, with notable outbreaks in Arizona, California, Florida, and Texas. Although we’re not yet seeing a national second wave, the risks are rising. Both the daily spread rate (now at 1.6 percent per day) and daily case growth (about 40,000 per day) have jumped from last week, in large part due to the four outbreak states. Despite this concerning medical news, the economic news was good. Layoffs continued to decline, while hiring continued to improve. Plus, with metrics like consumer confidence, consumer spending, and housing all showing signs of improvement, it appears the overall recovery remains well on track.

The bad news this past week is that the chances of a national second wave of infections are increasing as localized outbreaks in several states continue to get worse. The states in question are Arizona, California, Florida, and Texas, with the Carolinas also under pressure. All have shown significant spikes in cases in recent days. Multiple other states are also seeing expanded case growth, although not yet at the levels of those four. While the virus remains under control in many states, the breadth and magnitude of the outbreaks continue to increase the risk at a national level.

Brad here. One of the questions I have been hearing a lot recently is whether it still makes sense to invest in international stocks. Indeed, it is a good question. Here, Anu Gaggar, Commonwealth’s international analyst, provides a timely and compelling look at why international markets may still make sense in your portfolio. Thanks, Anu!

COVID-19 case growth has spiked up recently in several states, taking the national case growth rate up above 30,000 per day for three of the past four days. So, do we have a second wave on our hands? And if so, what does that mean?

Last week saw a number of important data releases come in above expectations, notably May’s retail sales report and June’s home builder confidence report. This will be another busy week for economic updates, with highlights on home sales, May’s durable goods orders report, and the personal income and spending reports for May.

Today, I'd like to discuss the coronavirus, including its effect on the economy and markets. Over the past week, we’ve seen some state-level outbreaks of the virus. Still, there’s no sign of a national second wave of infections, with the daily spread rate at just above 1 percent and the daily case growth at 25,000 per day. So, despite some bad news at the local level, the virus remains under control and is actually showing signs of improvement in many states. On the economic front, the news was better. Layoffs continued to decrease, while hiring continued to improve. Perhaps the biggest news, however, was that consumer retail spending came in much better than expected, meaning consumers have jobs and are feeling confident.

The bad news this past week is that there are signs of localized outbreaks in several states, specifically Arizona, California, Florida, and Texas. All have shown significant spikes in cases in recent days. But the good news is that outside these and a handful of other states, the virus remains under control, and there is still no national second wave of infections.

With the market moving back up to close to its all-time highs, the betting would clearly seem to be that everything will be all right and that the V-shaped recovery is well underway. When you look a bit deeper, though, even if those positive assumptions come true (possible, but certainly not guaranteed), there are still reasons to be concerned about where the market is now. Let’s take a look at the details.

Brad here. One of the side effects of the recent stock market pullback, combined with the pandemic, has been an increase in the perceptions of risk—in everything. Recently, we have gotten a number of questions about an article that claimed we were headed for another financial crisis on top of everything else. It was a very scary article, but (spoiler alert!) as my colleague Nick Follett discusses below, it was overstated and, in many respects, just plain wrong in many of its assertions. This post is a bit more technical than we usually do here, but I think it is worth taking a deeper dive to understand what is really happening. Over to you, Nick!

Last week saw a number of important economic updates, with a focus on inflation, the Fed’s June meeting, and consumer confidence. June’s consumer confidence report was a highlight, revealing better-than-expected results that bode well for consumer spending growth. This week, which will be relatively quiet, will include important updates on May retail sales and the housing market in May and June.