June 8 – 12, 2020 Recap
Federal Reserve Provides a Dosage of Reality
The three major U.S. equity indices finished higher on Friday in a broad but overall modest recovery from a steep 7.1% three-day S&P 500 plunge. Although the mid-week slump was bookended by gains that helped moderate losses to under 5%, it was still the worst weekly equity performance since March 20. In essence, investors locked in profits, selling overbought positions amid concerns over a rise in COVID-19 cases in several states and discouraging views from the Federal Reserve that the economy will take longer to recover than previously estimated.
For the week, the Dow Industrials sank 5.55%, the S&P 500 lost 4.73%, and the Nasdaq Composite declined 2.27%. The small cap Russell 2000 index underperformed larger capitalization indexes, giving back 7.89%. The S&P 500 snapped a three-week rally and through Friday is down 4.98% year-to-date (YTD).
The Weekly Recap is published by Cetera Investment Management LLC, an SEC registered adviser owned by Cetera Financial Group. Cetera Investment Management provides market perspectives, portfolio guidance, model management, and other investment advice to its affiliated broker-dealers, dually registered broker-dealers and registered investment advisers.