We are now halfway through the memorable summer of 2020 and I am wondering; how are you doing? It’s important to ask this question not only of ourselves, but of our family, friends and neighbors. As the cases here in Maryland and across the U.S. continue to creep higher again, we must remain diligent in our precautions and safety measures. I find it more difficult to maintain my sanity as our children engage in more activities, and the pool time increases with the summer heat. I still find myself wondering if we are in an experiment, or in some kind of science fiction movie and the plot twist has yet to appear. A lot of us are also wondering what the upcoming school year will look like. Will it be remote, in person, or a combination of both? We shall learn our collective fates soon enough!
Our financial markets continue to “discount” the media hype and headlines while plowing head-first into corporate earnings. Stocks showed several straight days of gains this week, with the NASDAQ hitting new highs and the S&P 500 coming close to flat for the year at one point before retreating on Thursday and Friday. Financial giants like Goldman And J.P. Morgan saw strong 2Q corporate earnings results, fueled by trading and transactional revenue. Expectations for second quarter growth and corporate earnings were expected to be non-existent, but many companies are proving otherwise. Large tech also continues to drive the momentum forward as the “work from home” trend looks to become a more permanent reality. The Modern news was another positive during the week as they continue to move along in their “human” trial phases for a vaccine. We are also expecting to see several other biotech giants announce additional new vaccine trials.
I'm leaning more and more to the realization that most States’ economies will not go into the same lock-down we saw in previous months. While bars may close and restaurant capacity could stay limited, the idea of a broader mask requirement is likely and probably expected. It seems as though; we have moved from the idea of avoidance to one of containment and mitigation. Covid is here to stay and only a vaccine will allow us the freedoms we have come to expect. This is our new reality, like it or not. I’m hearing from more and more of you expressing fears about the upcoming election and what that will mean for your investments and future. Personal political views aside, we know from history that Democratic ideals are typically met with strong resistance from Wall Street. Higher taxes, bigger government, more regulations and less capitalistic views tend to dampen “growth” from a business perspective. This could cause additional volatility and weakness as we move closer to November. We are more than aware of these concerns and share them as well. You should expect to hear from us regularly as things develop and know that we have a plan in place to adjust as needed. As always, when you have questions or concerns, reach out!
The last few months have not been easy for anyone and we certainly can’t predict what the next few months will bring. But I do know that engaging with you and sharing stories has made things much more bearable. We are in this together. Stay safe!
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