Market Briefing

Market Briefing

News, analysis and commentary

By Logan Robertson and Thomas J. Connelly, CFA, CFP®

March 27, 2020

US Equity markets erased nearly all of yesterday’s gains today, with the S&P 500 and Dow Jones Industrial Average finishing at 2,590 and 21,929 respectively. The Energy sector led the pack, posting a 1.6% gain, while Utilities performed worst, down -4.0%. The VIX volatility index fell again, now down to 53.43, coming from highs in the 80s earlier this month. For the month of March, US equities finished down -12.3%, about middle of the pack compared to other countries.

US Bond yields fell dramatically over the month of march: at the long end, 30 Year Treasury yields dropped 34 basis points to 1.32%, while on the shorter end of the curve, 1 Year Treasury yields collapsed 87 basis points to 0.14%.

Gold fell -2.7% today, ending a volatile month flat.

Bid/Ask spreads, as well as discount/premium to NAV spreads in ETFs and closed-end funds, are tightening back up across the equity and fixed income markets. This is hopefully a sign of decreased expectation of volatility and lowered concerns about liquidity going forward. Most notably, concerns about trading in emerging market and international bond markets seem to be subsiding.

President Trump called for a $2 trillion infrastructure bill today, citing the low interest rate environment and employment opportunity as benefits. Arizona joined the pack today with a “Stay Home, Stay Healthy, Stay Connected” executive order taking effect at close of business today.

According to the order, individuals “shall limit their time away from their place of residence or property, except to conduct or participate in Essential Actives… Essential Functions… or Essential Businesses.”  Furthermore, “No person shall be required to provide documentation or proof of their activities to justify their activities under this order.” The full document, including the definitions of “Essential,” can be accessed via this link.

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