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Market Commentary 30 April

Welcome to the market commentary for the last day of April 2020, not much has changed in terms of the direction of the market, the equities have continued to go up higher, oil has been quite volatile. I think we have had good earnings from Facebook, I think the internet stocks have gone up a little bit so that pushed the equities up and I think also the push by the US to find a vaccine has accelerated so I think that was the good news behind the rise in the S&P for example. In terms of coronavirus statistics here in New Zealand we have only had I think 3 new cases today.

If you look on the global site we still had around 75000 new cases and a third of that US alone right, and total deaths now are about 225 thousand so far and it's still moving up. Although here in New Zealand it's started to get quiet so people are thinking things will normalize soon. Everyone seems to be wanting that and the economy should normalize. Whether it’s here or in the US they have just to open up more factories because the longer they stay in lockdown, they have been in lockdown now for six weeks it is going to be very dark.

Yeah, there is definitely a price to pay for this lockdown thing everyone is keen to move out of it. If it's too early no one knows for sure but economy-wise, things have to start moving again because the money the cheques cannot keep flowing forever to people at home, I mean maybe we can have a look at the charts just a visual.

Yeah before we discuss the charts it looks like people are very optimistic that they should find the vaccine soon like given what is this company, Visavir and their preliminary findings they’re hopeful it should be approved by the FDA fast-tracked but I personally I think it's going to be a few months away but they don't think so. That’s why the stock market has gone up, gold has gone up, currencies have gone up, looks like everything's going up, even bitcoins going up it’s about 8000 right now.

So just to show you the charts the Dow Jones ETF so we're approaching the 25000 remember we drop all the way below 20000 right so we’re even above the 50% retracement now so we have recovered more than 50% of the down move which is very promising like you've mentioned last night everything was up, Tesla had a good earnings report, Microsoft, Facebook, everything was up that's why NASDAQ was up about 3% which is very good so everything looks rosy at this point in time but I think it's more wishful thinking at this point.

Definitely, even the NZD/USD rate is up I think the highest it has been since mid-march. Back at 61 right?  Yeah currently it’s at 61 but then again there are some market commentators that say this was just a retracement during the bearish markets we have seen this before but then again we also have data out of China today I think their economy has contracted a bit,  the manufacturing sector has contracted as well, so things are slowing down and we’ll have to wait and see. I mean we've got some relatively good earnings but again just from Microsoft and Facebook but everything seems to be really optimistic at the moment but at some point, there should be a little rebound for one of those things like we haven't even discussed the second wave, third wave, you know but for now, let's enjoy what we have things are flattening out but yeah I think the one data point this week is on Friday again unemployment claims in the US.

They have been obviously going up but we've seen the market has not really reacted to this by a lot but we'll have to wait and see what the number says this Friday. I hope everything goes well and New Zealand things are going well for now but we've just exited the lockdown so we'll have to wait and see if cases pick up again or see if the virus has been eliminated from here.  You can now buy McDonald's. I think that's all from us for this week again we are back next week with another update and thanks Ricardo and we'll see you next week. Ok, see you!

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