D&D Note (4.27.2020) ~ Stocks Stage Hope Rally As Oil Plunges ~
Markets finish cash trading today strongly in the green as bonds dropped on the day. Today was a classic Risk On day, however still built on Hope and not any technical or fundamental basis.
As we get closer to turning on select portions of State economies the market is turning that Hope into Risk. Although not all economies are reopening back up with just today San Francisco and the Bay Area of California announcing an extension of Shelter-In-Place policy through May (previously it was due to end May 3rd).
DOW up 1.51%
S&P 500 up 1.47% (2878.48)
NASDAQ up 1.11%
VIX fell -7.35% to 33.29
One major aspect the markets looked passed today was the huge drop in Oil prices. NY Crude fell -24.14% to 12.84 a barrel.
Corn prices also fell today down -3.02%. Much of American corn crops are grown for use in ethanol not for food consumption.
The FED expands its municipal lending program for now smaller cities with just 250k or more people.
10 minutes into the new SBA Payroll Protection Program reopening back up the whole system crashed and locked users out showing once again that even this second round is not going to be enough due to such high demand.
One stock that rallied big today was Tesla up over 9%. However the decision to extend the Bay Area Stay at Home policy directly effect the Fremont factory which will weigh on investors minds in tomorrows trading session.
Health news of the North Korean leader Kim Jong-un is still very conflicting. Some reports suggest he might already be dead to others saying there is nothing wrong. If the leader does in fact die or is dead the likely successor is his sister.
~ Dave James / Principal Trader and Market Strategist