Week 43 - $801.08
Stock gains climbed from news of better-than-expected economic data as the US continues to recover its job losses, but with the pandemic still ravaging the country it remains uncertain whether this trend will continue.
Total Report (Since October 11th, 2019)
Positive Performing Sectors
1. Materials (+24.91%)
2. Consumer Staples (+19.03%)
3. Industrials (+18.08%)
4. Consumer Discretionary (+17.43%)
5. Healthcare (+14.16%)
6. Financials (+9.15%)
Negative Performing Sectors
7. Utilities (-4.80%)
8. Communication Services (-11.19%)
9. Information Technology (-13.89%)
10. Real Estate (-16.30%)
11. Energy (-19.15%)
1. Materials (+24.91%)
2. Consumer Staples (+19.03%)
3. Industrials (+18.08%)
4. Consumer Discretionary (+17.43%)
5. Healthcare (+14.16%)
6. Financials (+9.15%)
Negative Performing Sectors
7. Utilities (-4.80%)
8. Communication Services (-11.19%)
9. Information Technology (-13.89%)
10. Real Estate (-16.30%)
11. Energy (-19.15%)
Weekly Report (August 7th, 2020)
Positive Performing Sectors
1. Information Technology (+3.81%)
2. Industrials (+3.51%)
3. Energy (+3.33%)
4. Real Estate (+3.00%)
5. Financials (+2.96%)
6. Materials (+2.87%)
7. Consumer Discretionary (+2.36%)
8. Consumer Staples (+1.67%)
9. Communication Services (+1.50%)
Negative Performing Sectors
10. Utilities (-1.14%)
11. Healthcare (-1.47%)
1. Information Technology (+3.81%)
2. Industrials (+3.51%)
3. Energy (+3.33%)
4. Real Estate (+3.00%)
5. Financials (+2.96%)
6. Materials (+2.87%)
7. Consumer Discretionary (+2.36%)
8. Consumer Staples (+1.67%)
9. Communication Services (+1.50%)
Negative Performing Sectors
10. Utilities (-1.14%)
11. Healthcare (-1.47%)
GICS Sector Performance Ratio - Balanced: From 5:6 (45.45%) to 9:2 (81.82%)
Review
Even with positive news on the July jobs report that exceeded expectations, longer-term issues still remain for an economic recovery in the US. Talks for new stimulus has stalled in Congress, and with no more funding for the Paycheck Protection Program, an major eviction crisis is imminent.
The jobs report is only illustrates the number of jobs gained in the US, and without any figures to reasonably compare it to, it is little more than a snapshot of what businesses are doing in light of the pandemic-related economic crisis. Jobs are coming back because they must. Many businesses depend on an on-site workforce to push out products and services. Economics is dependent on two main components to function: the producer and the consumer. Businesses provide a good or service and the consumer credits the producer in exchange for those goods and services. Even as businesses begin to reopen and restaff, the lack of consumer spending is holding back a full economic recovery. There remains no real incentive for consumers to risk their credit on luxuries when there are more pressing matters to resolve, such as rent. Businesses are hiring and jobs are slowly coming back, but that money is not circulating as well as it should be.
The economic recovery will be slow and likely painful for many. Without the full support of the government to back its citizens to effectively allocate resources back into private enterprises, the economic downturn will last longer than anticipated. Stocks are driven up by "better-than-expected" outcomes, but expectations are only estimates. They are not by any means a true reflection of the state of the economy. Stocks might very well be overvalued given the current economic situation, but once a vaccine is made and the economy returns to normal, only then will the true state of the economy be revealed.
The jobs report is only illustrates the number of jobs gained in the US, and without any figures to reasonably compare it to, it is little more than a snapshot of what businesses are doing in light of the pandemic-related economic crisis. Jobs are coming back because they must. Many businesses depend on an on-site workforce to push out products and services. Economics is dependent on two main components to function: the producer and the consumer. Businesses provide a good or service and the consumer credits the producer in exchange for those goods and services. Even as businesses begin to reopen and restaff, the lack of consumer spending is holding back a full economic recovery. There remains no real incentive for consumers to risk their credit on luxuries when there are more pressing matters to resolve, such as rent. Businesses are hiring and jobs are slowly coming back, but that money is not circulating as well as it should be.
The economic recovery will be slow and likely painful for many. Without the full support of the government to back its citizens to effectively allocate resources back into private enterprises, the economic downturn will last longer than anticipated. Stocks are driven up by "better-than-expected" outcomes, but expectations are only estimates. They are not by any means a true reflection of the state of the economy. Stocks might very well be overvalued given the current economic situation, but once a vaccine is made and the economy returns to normal, only then will the true state of the economy be revealed.
Last Week's Update (July 31st, 2020)
M1 Finance Platform Referral Link: https://m1.finance/UIl_N9XNA_CO
M1 Finance Dividend Aristocrats 2020 Pie: https://m1.finance/quB1JH2k6
M1 Finance Platform Referral Link: https://m1.finance/UIl_N9XNA_CO
M1 Finance Dividend Aristocrats 2020 Pie: https://m1.finance/quB1JH2k6
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