Displaying items by tag: covid

Thursday, 20 August 2020 16:31

News on Vaccines Could Bring Major Volatility

(New York)

For the last few weeks the market has had somewhat of a respite from the constant stream of vaccine-related market yo-yoing. However, it looks like it is going to start again as several COVID vaccines are reaching a critical stage of testing. Multiple vaccines, one from Pfizer, are entering phase 3 of their trials and some anecdotal evidence says Pfizer’s version is getting better. Johnson & Johnson has a vaccine in a similar position. Markets have shown significant volatility in the past when news about vaccine trials has been released.


FINSUM: The economic implications of a successful COVID vaccine are monumental, so expect significant volatility on material vaccine news, especially as these vaccine trials enter later stages.

Published in Eq: Total Market
Monday, 17 August 2020 16:35

A Bullish Sign for Real Estate

(New York)

Real estate, especially residential real estate, is one of the sectors that has held up much better under COVID than many expected. With such hefty job losses, many thought early on that the market might suffer seriously. However, home prices have held steady, and in a bullish sign, homebuilders are feeling very confident. The bullishness in the sector seems to stem from a pair of factors—desire for single family homes during COVID, and exceptionally low interest rates. The Homebuilders index rose to a measure of 78 in August, up from 72 in July, setting a record that goes back to 1998.


FINSUM: This is a great sign for homebuilding stocks, and the economy more generally. It is a sign that the American consumer—at least the subset that is in the market for houses—is holding up okay. That said, it is the lower end of the socioeconomic hierarchy than seems to be suffering the most from COVID lockdowns.

Published in Eq: Real Estate
Thursday, 13 August 2020 17:28

FedEx is Poised to Surge

(Memphis)

FedEx and other logistics providers have risen alongside other stocks, but their gains have not been nearly as prolific as some of the ecommerce providers they service. However, that may be about to change. Multiple Wall Street analysts are changing their tune on the company, saying that the stars are aligning for the stock. In particular, UPS is starting to raise prices, which will help FedEx with profitability alongside the huge explosion in ecommerce volumes that has coincided with people staying at home. Furthermore, as a vaccine is developed, FedEx and other logistics providers will need to deliver millions of doses of vaccines, which will be another boost.


FINSUM: Two big factors here really—UPS and USPS are raising prices, allowing breathing room for FedEx; and…FedEx is a leader in temperature-controlled shipping, which is what will be needed for vaccines.

Published in Eq: Value
Tuesday, 11 August 2020 15:58

The Best ETF for Playing COVID Retail

(New York)

There has been a lot of negative press about the fate of retail under COVID, and with good reason. Brick and mortar businesses have been devastated and the bankruptcies have been relentless. However, one of the less noticed aspects is that many ecommerce businesses are doing very well. In fact, some retail ETFs, like the Amplify Online Retail ETF (IBUY) have been surging as stocks like Carvana, Overstock.com, and Peloton have seen their shares soar.


FINSUM: Ecommerce is a great bet for right now and for the foreseeable future. In its most basic sense, all COVID did to retail was accelerate the shift to ecommerce into a much faster gear. It was like a five-year jump in four months. There is no reason to expect that to revert any time soon.

Published in Eq: Value
Friday, 31 July 2020 08:46

Some Weakness Appears in the Housing Market

(Miami)

May was a rough month for the housing market, new data shows. Much of the media narrative has been on the strength of the housing market of late, but the most recent data shows that home sales fell almost 10% in May. Further, home price growth decelerated from 4.6% to 4.5% in the same month. Some economists think home price growth figures are being artificially inflated by the total lack of homes for sale, with inventory very low.


FINSUM: It is hard to tell how healthy the housing market actually is. In one way, it does look healthy, but the lack of inventory and its relationship to prices reminds us when corporate bonds market seize up and there is so little inventory that prices stay “high” because of the lack of liquidity. This is an obvious exaggeration, but there could be some truth in it.

Published in Eq: Real Estate
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