COVID-19 data is the new econ data... In mid-March, markets plunged 30% on the alarming surge in coronavirus cases. Months of economic lockdown followed, and US COVID-19 cases slowed thanks to distancing measures. Investors took heart: markets swiftly rose in April and May, approaching record highs. This continued through June, as economies began to reopen. Yesterday, stocks took a health data plunge.
Not entirely surprising... It's not shocking that cases are rising as restaurants, bars, and gyms reopen across the US. However, cases in European countries appear to have fallen and are not surging again as countries reopen. "Public health guidance" in Europe can be perceived as "infringement of freedom" in America. Now the EU might even block US travelers from entering.
The longer the pandemic lasts, the longer tech stocks are likely to rally... The tech-heavy Nasdaq’s gain over the other major indexes is the biggest since 1983. This outperformance shows how fortunes have shifted dramatically in tech's favor during the corona-conomy.