April 7, 2020 - Market Update

Treasury prices were lower yesterday as equities seem to be the investment of choice. For the day, benchmark 10-year notes were down 26/32 pushing yields up to .69%, while 30-year bonds fell 1-17/32 with yields at 1.27%.

On Monday, the major stock indexes surged as some of the virus tolls in major “hotspots” showed signs of slowing over the past few days.  New York Governor Cuomo stated the virus-related deaths appeared to have hit a plateau in the state that that has become an epicenter in the U.S.  Some positive news for the first time in weeks had investors in risk-on mode. The Dow rose 1,627 points to 22,679, the S&P was up 173 points to 2,661, and the Nasdaq was higher by 540 points to 7,913.

In a usual month, about a million jobs are created in the US and about 800,000 are destroyed, with net job growth of +200,000. The reason the March job report looked relatively bad at -700,000, is because there was reasonably normal job destruction in March, but absolutely no hiring! This is because no jobs were created. Essentially, firms stopped hiring in March, but didn’t do much firing. We will see what happens in April.