Archives of “April 3, 2020” day

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S&P affirms US rating at AA+, outlook stable

  
  Analysis
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Is there a “too big to downgrade” rating?

Especially in the current global predicament
S&P ratings
  • US rating is constrained by high government debt and fiscal deficits, both are likely to worsen this year after the coronavirus shock
‘likely’ to worsen??? Nothing unlikely about it.
More:
  • expect US economic recovery in 2021, which will partly compensate for loss of output this year, then continued GDP growth afterwards
  • expects general government deficit to fal;l below 5% of GDP by 2022
  • expects the US economy to contract around 1.3% in 2020
  • recovering by 3.2% in 2021
  • 2.5% in 2022

Friday will bring nonfarm payroll data from the US – Goldman Sachs preview

  
  Analysis
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Goldman Sachs were very close to the money indeed for jobless claims.

I posted yesterday:
  • US Jobless claims data due Thursday – Goldman Sachs forecasts 5.25m
And then, prior to the data they boosted their forecast:
  • Goldman Sachs raises US weekly initial jobless claims forecast to 6 million, from 5.25 million previously
Note that this NFP report is unlikely to be instructive, the survey was mainly before the big impact of the coronavirus outbreak on the economy. Over to GS’ comments:
  • estimate for nonfarm payrolls is a decline of 180k in March
  • unemployment rate up 0.3 to 3.8% … risks skewed towards a larger increase
  • the March employment numbers are already fairly stale and insignificant in our view, because the April report will likely show job losses in the millions.
Goldman Sachs were very close to the money indeed for jobless claims.

US Federal Reserve asset purchases are stunningly large – recent data

  
  Analysis

In the days between March 16 and April 2, the Fed has purchased

  • $935 billion in US Treasurys
  • $344 billion in mortgage bonds
Its going to take a while before the fiscal support cash flows out to the consumer and businesses, Fed might wind back a bit when this does happen.
Meanwhile, there will be more to come  from the Fed (and other central banks around the globe)

US Indices run higher into the close. Major indices close near session highs

  
Analysis, US Market
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Major indice rise by 1.6% to 2.2%

The US stocks ran higher into the close with the major indices rising about 0.9% more in the last hour of trading.
The final numbers are showing:
  • The S&P index rose 56.09 points or 2.28% at 2526.90
  • The NASDAQ index rose 126.73 points or 1.72% at 2487.31
  • The Dow Industrial Average rose 1 and 69.93 points or 2.24% at 21413.44
Going into the last hour of trading, the major indices were trading at:
  • S&P index up 32.81 points or 1.33% at 2503.31. The final hour added 0.95%
  • Nasdaq index up 54.859 points or 0.75% 7415.44.  The final hour added 0.97%
  • Dow up 275.64 points or 1.32% at 21219.15. The final hour added 0.92%
Some winners today included:
  • Chevron, +11.06%
  • Exxon Mobile, +7.62%
  • Morgan Stanley, +7.18%
  • Gilead, +6.09%
  • Broadcom, +5.77%
  • Nvidia, +5.16%
  • Intel, +4.80%
  • Caterpillar, +4.8%
  • IBM, +4.77%
  • Procter & Gamble, +4.62%
  • Lockheed Martin, +4.46%
  • Mastercard, +4.46%
Some losers today included:
  • Beyond Meat, -9.58%
  • United Airlines, -8.72%
  • Walgreens Boots, -6.14%
  • Slack, -5.94%
  • United Technologies, -5.92%
  • Boeing, -5.82%
  • Tesla, -5.63%
  • Delta Airlines, -4.78%
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