Morning Minutes 5/8/2020

Morning Minutes

Trade, Earnings and Employment in Focus

Month Day, Year

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Market Commentary By:
Colin Cieszynski, CFA, CMT
Chief Market Strategist
ccieszynski@siawm.com
+1 (647) 282-4428

Stock markets around the world have been climbing overnight following reports that the lead negotiators on the US-China Phase One trade deal had an official call on implementing the deal which went well. This was seen as a positive by investors who had been worried about the recent war of words between US and Chinese officials over COVID-19 could impact trade relations.

Overseas markets have been climbing on this news with the FTSE, DAX and the Hang Seng posting gains of 1.0%-1.4%. China-sensitive copper is up 1.4% today, while WTI and Brent Crude are both up about 1.0%. Gold is holding steady just above $1,700/oz.

US index futures are also up about 1.0% this morning and have been holding their ground following dismal employment numbers for the US and Canada. Investors have been more focused on weekly jobless claims for almost two months now, so huge declines in monthly numbers have been widely telegraphed, anticipated and priced into the market. It would appear that the bigger questions for investors at this point include how long is it going to take to get most people back to work, and can we trend toward a full recovery eventually, or has COVID-19 caused lasting structural changes to employment and society?

US nonfarm payrolls plunged by 20.5 million positions in April, which was less than the 22.0 million the street had been expecting. The unemployment rate jumped to 14.7% from 4.4% a month earlier, which was worse than the 14.0% the street had expected. Canada lost 1.99 million jobs in April, adding on to the 1.0 million jobs lost in March, but that was less than the 4.0 million in job losses the street had been expecting.

Today’s slate of earnings has been headlined by Uber which is up 5.7% in premarket trading. The ride sharing company posted a $2.9B loss for Q1 mainly on writedowns but more importantly it gave an indication of the impacts of COVID-19 on its business. Ride bookings for Uber fell 5% in Q1, plunged 80% in April, and apparently have been improving for the last three weeks. Bookings for Uber Eats jumped 50% with more people ordering food delivery and more restaurants signing on to the service.

 

New Video: Market Commentary and Portfolio Update – May 6, 2020

With Jeremy Fehr – Founder and CEO, Paul Vendrinsky – Portfolio Manager and Ted Bader – President of SIA Wealth Management

A new webinar replay is available featuring Jeremy Fehr, founder of SIACharts and SIA Wealth, discussing current trends in world markets. Paul Vendrinsky, Portfolio Manager, discusses recent transactions and updated sector weightings in the five funds which SIA Wealth sub-advises on for BMO Global Asset Management. SIA Wealth President Ted Bader discusses investment strategies related to the portfolios that SIA Wealth Management sub-advises for BMO Global Asset Management. A PDF version of the presentation is available.

GoToMeeting Version: https://attendee.gotowebinar.com/recording/1009850159797133570

YouTube Version: https://www.youtube.com/watch?v=jD1Uzj8R4HQ&feature=emb_logo

 

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