No More Bear! - Data update for August 21, 2020
We are no longer in a bear market, it ended this week. We share some interesting data about that. We also share the updated Covid-19 tracker from First Trust Portfolios.
No More Bear!
On Tuesday August 18th, the S&P 500 set a new high. This means no more bear! We will have a lot about this on our next episode of Monday Morning Money.
Liz Ann Sonders from Charles Schwab (our soon to be custodian) posts some great data on Twitter. Here are some interesting facts about the recovery…
The “Awesome 8”
Eight companies have led the charge higher in the recovery. And most of the rest of the companies haven’t done very well.
Fixing typo from earlier: YTD, “Awesome 8” (large tech/growth mega-cap stocks) are up ~60%, which is considerably more than even NASDAQ 100 … meanwhile, median U.S. stock has lost 14% this year @BCA research pic.twitter.com/a87sI9rQku
— Liz Ann Sonders (@LizAnnSonders) August 21, 2020
More evidence of a few big companies leading the charge.
Basket of 5 largest stocks in S&P 500 made new high yesterday; looking at returns since beginning of 2018, just those mega-cap names are +100%, while broader market is +25.6% @Bloomberg
[Past performance is no guarantee of future results] pic.twitter.com/KKWB81oahl— Liz Ann Sonders (@LizAnnSonders) August 21, 2020
Missing the Big “Up Days”
You always hear someone talking about missing the big up days. It turns out many of them happen when the market is crashing.
Avg return on up days during “pandemic plunge” bear market was +4.3%, while avg return on up days so far in new bull market has been +0.9% (same concept was true for GFC, but to lesser degree)…highlights tendency of some of largest up days to occur in bear markets pic.twitter.com/p65zvUcDgQ
— Liz Ann Sonders (@LizAnnSonders) August 20, 2020
Virus Data Update
Our friends at First Trust Portfolios have updated their virus data tracker.
Key Takeaways…
- New positive tests and deaths continue to show a downward trend.
- Progress continues on the development of a vaccine.
- The US currently has some of the strictest social restrictions in the world right now. (green line).
- This is nowhere near as deadly as the Spanish Flu in 1918. And it isn’t as bad as the 1957-58 flu outbreak.
- The number of states reporting increasing numbers continues to track lower.
“Fast Data” from First Trust
Fast data includes passengers being screened at TSA checkpoints and other data available weekly. Below is some other data that shows an uptick in activity.
About the Author
Neal Watson is a Certified Financial Planner™ Professional and a Financial Advisor with Fleming Watson Financial Advisors. He specializes in helping hard working, middle class families plan for retirement.