While economic data continues to paint a dark picture for the global economy, N.A. markets resumed their ascent this week as many investors continue to hold out optimism for a strong recovery, or perhaps a medical breakthrough in the fight against coronavirus. On Monday the Dow jumped more than 900 points on initial hopes for a potential vaccine after drug maker Moderna reported signs of progress in its initial human trials. Also lifting sentiment was a sharp uptick in crude prices, which rose 8% in light of rising global demand and record supply cuts. However, Monday’s exuberance faded on Tuesday as a report cast doubt over data quality in Moderna’s trial. By Tuesday’s close, the Dow was off nearly 400 points, while the Nasdaq dropped 50. In Canada, the TSX jumped nearly 250 points as investors led a catch-up rally following the Victoria Day holiday.
The three major U.S. indexes recorded their fourth gain in five sessions Wednesday as investors once again looked toward a swift recovery, buoyed by rising oil prices and additional pledges of help from the Federal Reserve. By Wednesday’s close, the Dow surged 369 points, while the S&P 500 added 49 points, as all 11 S&P sectors recorded gains.
However, N.A. markets opened lower and stayed in the red Thursday as jobs data continue to paint a troubling picture. In the U.S., workers filed 2.4 million new jobless claims last week, a slight drop-off from previous weeks. And yet the numbers are staggering, with U.S. claims over the past nine weeks topping 38 million. And that total doesn’t account for the hundreds of thousands of self-employed and gig-economy workers. Meanwhile, Canada lost more than 226,000 jobs in April as the economy shut down, with trade, leisure and hospitality among the hardest-hit industries. Also weighing on sentiment Thursday were new concerns over growing trade tensions between the U.S. and China. Finally, oil prices rose 3% Thursday, advancing for the sixth straight session as producers continue to curtail supply.
source https://richarddri.ca/markets-holding-out-hope-for-strong-recovery/
Dri Financial Group 