Germany Coming Back Online

I have to say, I’m very impressed with the session thus far after an avalanche of bad new this morning.  It’s not that anyone was surprised by the data, but it was the perfect kindling for bears to try to burn down the market.  Don’t get me wrong, there was a tremendous effort to talk down the market this morning by the same folks that had the nerve to say the rebound wasn’t a big deal.

I’m not sure where the breaking point is for investors, but surely, they have more confidence and nerve than they did a few weeks ago.  But they need a spark and that comes back when this economy comes back online. 

Other factors include continued support of the economy to provide a bridge to recovery.  I hope Congress doesn’t keep playing games with additional funding for small businesses, especially after bailing out the airlines – again.

The market was holding up nicely, putting up a stand all session, but now it trying to rally on news that Germany will begin to come back online beginning April 20.

Bending the Curve

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Several key Covid-19 metrics appear to be in place for Germany including:

• New recoveries increasing faster than new cases
• Active cases appear to have peaked at 72,865 on April 6 to 60,515 April 15

Daily New Cases

On March 27, daily new cases of 6,933 dipped, then climbed back to 6,813 on April 2, and have now tumbled to 2,138 as of yesterday.

To see the charts, click here, and here.

Message of Market

Energy continues to crumble, and it’s clear OPEC and all the other major players are going to have to cut production substantially more.  Meanwhile, banks came into the week with potential to be big winners with Fed backing, but instead sky-high loan loss provisions are weighting down these stocks.

The momentum crowd making moves in Technology and Communication Services as Consumer Staples solidify themselves as the new “quality” names that should be in every portfolio.