June 22, 2020
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Market Commentary By:
Colin Cieszynski, CFA, CMT
Chief Market Strategist
+1 (647) 282-4428
Thereâ€™s an old saying out there that â€śrising stock markets climb a wall of worryâ€ť and that seems to be the case heading into the new trading week.
Despite continuing increases in COVID-19 case counts in several US states over the weekend, US index futures continue to advance with gains of 0.75% to 0.95%. Dow futures are up about 205 points, essentially offsetting Fridayâ€™s 208-point loss.
Over in Europe, the Dax is down 0.4% while the FTSE is down 0.2%. A financial scandal at German payments company Wirecard, where $2.1B has apparently gone missing and reportedly may not exist at all, has been weighing on sentiment.
Corporate news has also been mixed. Paint producer Sherwin Williams indicated Q2 sales declines are expected to be less than previously thought with some consumers taking advantage of the time stuck at home by doing projects. On the other hand, China announced it is stopping imports from one of Tyson Foods poultry plants due to a coronavirus outbreak there.
Commodity action is mixed this morning as well. Copper has gained 1.0% overnight but WTI crude oil is down 1.25% as investors weigh the potential demand rebound from reopenings against the potential implications of new case flareups and hotspots in several countries including the US and South Korea. Â Gold is up 0.2% trading just above $1,750/oz.
Its the last full week of the month and the quarter, and with summer approaching as well, the economic/corporate news calendar is pretty light this week. The main economic event is Tuesdayâ€™s flash PMI reports for the US and Europe, an initial snapshot on June activity. There are a smattering of earnings reports due including Blackberry on Tuesday, and Nike on Thursday.
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