The Independent Market Observer

So Far, Medical Risks Not Derailing Economic Recovery

July 16, 2020

This week’s update is somewhat worse than last week’s. Medical risks are still rising. Outbreaks in several states (notably, Arizona, California, Florida, and Texas) continued to get worse, even as other states began showing faster outbreaks.

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Are Localized Viral Outbreaks Turning into a National Threat?

July 9, 2020

This week’s coronavirus update is pretty much the same as last week’s. The medical risks are still rising. Outbreaks in several states (notably, Arizona, California, Florida, and Texas) have continued to get worse. All have shown significant spikes in cases in recent days, and health care capacity is now a concern in some cities. Further, multiple other states are also seeing expanded case growth, although not yet at the levels of those four. At the national level, as of July 9, the number of new cases broke above 60,000 for the first time, and the daily spread rate is now at 2 percent per day. Similarly, even as the number of tests continues to rise, the positive rate is also increasing. The breadth and magnitude of the outbreaks continue to increase the risk at a national level.

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Is the Value Premium Dead?

July 8, 2020

Brad here. Another question I have been getting repeatedly is whether value is dead. Just as with emerging markets, a long run of underperformance has raised this question. Is the situation different now? Peter Essele, one of Commonwealth’s most senior portfolio managers, is very well positioned to answer that question. Over to you, Pete!

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Looking Back at the Markets in June and Ahead to July 2020

July 7, 2020

June was a mixed month. The national reopening in May and June led to new viral outbreaks and a spike in new infections in multiple states. Surprisingly, though, both the economic recovery and financial markets did very well. As we enter July, the question of many minds is whether the medical situation will improve—and whether the good economic and market news will continue.

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Economic Recovery Persists Despite Rising Risks

July 3, 2020

The bad news this past week is that the medical risks are still rising. Outbreaks in several states, notably Arizona, California, Florida, and Texas, have continued to get worse. All have shown significant spikes in cases in recent days, and health care capacity is becoming a concern in some cities. Multiple other states have also seen expanded case growth, although not yet at the levels of those four. At the national level, as of July 1, the number of new cases broke above 50,000 for the first time, and the daily spread rate is now approaching 2 percent per day. Similarly, even as the number of tests continues to rise, the positive rate is also increasing. The breadth and magnitude of the outbreaks continue to increase the risk at a national level.

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Why Has the Market Disconnected from the Pandemic?

June 30, 2020

Right now, we seem to be seeing a disconnect between the rising case counts and the rising stock market. Yes, there was a bit of a pullback on the news that case growth was hitting a new high. But since then, the markets have started to bounce again, even as case counts continue to increase. I get many questions about this disconnect. Indeed, on the surface, it seems to make no sense. What is going on here?

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Pandemic Growth Picks Up, But Economic Reopening Continues

June 25, 2020

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.

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