Stocks chugged higher as the government responded to the coronavirus crisis with more funding
While the first full trading week of April was a short one, it was jam-packed with market-moving headlines, which, for the most part, kept the major indexes chugging higher. On Monday, the Dow extended its Friday rally as news over slowing coronavirus cases in New York and Europe encouraged investors. Some of these gains were lost on Tuesday, however, with stock dipping below breakeven during the final hour of trading, as all eyes fixated on a potential $1 trillion Phase 4 relief package promised by lawmakers.
Markets resumed their climb higher as the week progressed however, and as of this writing, the Dow is heading for a massive weekly gain, after the Federal Reserve pumped $2.3 billion in businesses and local governments, with Fed Chair Jerome Powell commenting that "market conditions have generally improved."
One of this week's biggest market-moving headlines, was U.S. Senator Bernie Sanders' announcement that he would officially be dropping out of the presidential race, leaving former Vice President Joe Biden, and current U.S. President Donald Trump the two front runners.
Insurance stocks in particular reacted positively to the news. One such name was blue chip UnitedHealth (UNH), with the shares also moving on a promise from the company to speed up $2 billion in payments and support to health care providers. Anthem (ANTM) also surged on the news, but wound up taking a breather on an analyst bear note the following day.
While this week's surge is injecting some much-needed optimism into markets, there's still plenty of shaky ground ahead as companies navigate the coronavirus crisis. This has driven many companies to withdraw full-year guidance while the pandemic plays out. Online clothing retailer Stitch Fix (SFIX) is just one firm withholding a full-year forecast. Pinterest (PINS) and Tractor Supply Company (TSCO), also make the list, though both companies also posted promising preliminary first-quarter numbers.
This past week we reflected on how long the adverse effects of COVID-19 could stick around, and how to mitigate any upcoming risk. We also took at look at the Relative Strength Index (RSI) and whether or not it's a good indicator of when to buy.
Looking ahead, investors will return from a long weekend to the start of yet another earnings season, with bank stocks taking center stage this week. Blue chips JPMorgan Chase (JPM) and Goldman Sachs (GS) will take center stage, while sector peers Morgan Stanley (MS) and Wells Fargo (WFC) will also attract investor's attention. Dow component and healthcare issue UnitedHealth (UNH) will also be gearing up for its time in the earnings spotlight. While the economic calendar isn't quite as busy next week, investors will comb through retail sales for March, industrial production data and the Fed's Beige Book.