Equities declined on Covid nervousness.  In some regions, cases are rising dramatically.  New York, New Jersey and Connecticut are requiring visitors to self-quarantine if traveling from virus hot spots.  Will the perceived insurgence hamper the recovery?   Johns Hopkins states cases increased by 1.4% Tuesday, nominally higher than the average daily increase of 1.3% over the past seven days.

Radically changing topics, the rebound from the March lows has been focused in several stocks.  FAANGM now comprise a record 24% of the S & P 500.  Their total capitalization is greater than the GDP of Mexico and Japan combined.

Wow!  In years gone by, all would for search for the underfollowed company.  Today it is all about the greatest owned companies hoping for yet even more buyers.  This has been the trend for several years but now it is beyond the manic stage.  No one knows when this trend will end but like every other trend this too shall end.

The economic calendar is crowded today.  How will the markets interpret jobless claims, durable goods, inventories, a regional manufacturing index and revised GDP?  The Citicorp surprise index is still at record levels.  As noted many times the data is consistently stronger than expected.

Last night the foreign markets were mixed.  London was down 0.14%, Paris up 0.48% and Frankfurt up 0.52%.  China was up 0.30%, Japan down 1.22%  and Hang Sang down 0.50%.

The Dow should open nominally lower on Covid fears.  The 10-year is up 6/32 to yield 0.68%.


The views expressed herein are those of Kent Engelke and do not necessarily reflect those of Capitol Securities Management. Any opinions expressed are statements of judgment on this date and are subject to certain risks and uncertainties which could cause actual results to differ materially from those currently anticipated or projected. Any future dividends, interest, yields and event dates listed may be subject to change. An investor cannot invest in an index, and its returns are not indicative of the performance of any specific investment. Past performance is not indicative of future results. This material is being provided for informational purposes only. Any information should not be deemed a recommendation to buy, hold or sell any security. Certain information has been obtained from third-party sources we consider reliable, but we do not guarantee that such information is accurate or complete. This report is not a complete description of the securities, markets, or developments referred to in this material and does not include all available data necessary for making an investment decision. Prior to making an investment decision, please consult with your financial advisor about your individual situation. Investing involves risk and you may incur a profit or loss regardless of strategy selected. There is no guarantee that the statements, opinions or forecasts provided herein will prove to be correct. If you would like to unsubscribe from this e-mail distribution, please reply to this e-mail and indicate that you wish to unsubscribe in your response.