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As we continue to deal with the spread of COVID-19, we thought it was important to review some facts about the virus that we know as of now. As you know, this is a developing situation, and the facts will change and evolve as our health care community learns more and more about the situation. But as of today (3/26/2020), here are what we believe to be very solid facts about the virus. Symptoms: According to the CDC, these most common symptoms of COVID-19 usually appear 2-14 days after exposure: fever, cough and shortness of breath. Emergency warning signs to get…

Extraordinary Market Events: Implied and realized volatility in both stocks and bonds has ramped to levels not seen since the global financial crisis. Equity markets officially entered bear market territory, with key benchmarks down over 20% from mid-February highs. The entire US Treasury yield curve briefly traded below 1%, as the 10-year bond breached 0.40% and set all-time lows. Oil has fallen 48% year-to-date as a pricing war between Saudi Arabia and Russia compounds global demand concerns. Aggressive Monetary Policy Response: 2/28/20 – In a short statement, Chair Powell acknowledged how “the coronavirus (COVID-19) poses evolving risks to economic activity,”…

The Federal Reserve cut interest rates today by half percentage point amid concern the coronavirus outbreak could threaten the US economy.  It is the first emergency move like this since 2008. “The fundamentals of the U.S. economy remain strong,” a statement from the Federal Reserve said. “However, the coronavirus poses evolving risks to economic activity. In light of these risks and in support of achieving its maximum employment and price stability goals, the Federal Open Market Committee decided today to lower the target range for the federal funds rate by 1/2 percentage point, to 1 to 1‑1/4 percent.” It continued,…

On Monday and Tuesday of this week, the Dow Jones Industrial Average fell nearly 2,000 points, falling from historic highs by approximately 6.5%. The spread of Coronavirus to countries such as Korea, Iran and Italy sparked the selloff which was compounded on Tuesday when the CDC warned Americans that a spread to the United States was highly probable. The Facts: Coronavirus (COVID-19) was first detected in the Hubei province of Wuhan City in China in December 2019. Since then, the disease has spread to a number of other countries with confirmed cases totaling over 81,0001 (as of 2/26/2019). Concern in U.S….

Please find the next blog in our monthly series that provides a review of the prior month’s market data, the state of the economy, and the global financial markets. Global Economy: Following the robust returns of 2019, there has been much speculation as to what may precipitate heightened volatility in financial markets. Would it be the U.S. impeachment process, a slowdown in global growth, earnings disappointments, conflict in Iran, or renewed tariff escalation with key trading partners? The first half of January was relatively calm, with U.S. tech stocks leading the way as global equity markets maintained an upward trend….

While the global economy extended its post-crisis recovery in 2019, growth occurred at its slowest pace since the global financial crisis. Despite the headwinds from a weak global economy, trade disputes, geopolitical tensions, and social unrest, it was a strong year for global equities. Key Highlights: Political and trade-related headlines fostered an environment of uncertainty Global economic momentum receded, despite notching another year of positive growth Central banks relented on monetary policy tightening, with the U.S. Fed cutting rates 3 times Non-U.S. stocks underperformed U.S. stocks, with emerging markets lagging all year The U.S. economy grew for the tenth consecutive…

Background The recently signed “Phase One” trade deal between the U.S. and China has been viewed with skepticism by some analysts. The deal mostly left existing tariffs in place, and there are doubts whether China can actually deliver on its promised $200 billion of commodity purchases over the next two years. Still, the deal showed a willingness to compromise and is an important act of de-escalation that seems to take worst-case trade war outcomes off the table. However, even with this positive outcome and a path to the potential reduction of tariffs taking shape, the U.S.-China relationship has been altered…