In today\u2019s Steady Investor, we look at key factors that we\nbelieve are currently impacting the market and what could be next for the\nmarkets such as:<\/p>\n\n\n\n
U.S. Services Rebound\nBetter Than Expected \u2013 <\/strong>The economic picture in the U.S. remains mixed and\nin flux. As of the end of the second quarter, over 40% of the U.S.\nhad reversed reopening plans or placed them on hold, and cases continue to grow\nat a rapid pace. Even still, investors should remember that recessions end when\neconomic growth starts \u2013 even if the growth only amounts to a trickle.\nManufacturing and services data suggests that the economic recovery, at least\nso far, has been better than a trickle. Two separate purchasing manager surveys\nindicated that demand stabilized in June and that orders were picking up. Job\nlosses also slowed, a sign that the worst of the crisis is behind us. The ISM\nnon-manufacturing report (measuring services) showed business activity in\nexpansion mode last month, with the PMI reading topping 50. The Markit\nnon-manufacturing survey showed a \u201cv-shaped\u201d bounce in activity as well, though\nnot quite to expansion territory. Both surveys exceeded economists\u2019 forecasts,\nwhich has been a common theme throughout this nascent recovery. Over 80% of\nindustries surveyed reported growth, and respondents struck a cautiously\noptimistic tone about demand returning over time. The services sector accounts\nfor around two-thirds of the U.S. economy, so improving data is meaningful as\nwe head into summer.1<\/sup> <\/p>\n\n\n\n ____________________________________________________________________________<\/p>\n\n\n\n News Keeps Getting Worse But Markets Keep Going Up, See Why?<\/a><\/strong><\/p>\n\n\n\n In our just-released\nJuly Market Strategy report, we take a look at why the markets keep going up\neven in the midst of the current pandemic, job losses, and economic shutdowns. <\/p>\n\n\n\n In this report, we\u2019ll\nexplain how and why the market can tell one story, while the economic data and news\ncycle tell another. We will also take a look at possible projections for the\nS&P 500 this year and beyond while offering readers some advice for\nnavigating uncertainty in the current environment.<\/p>\n\n\n\n If you have $500,000\nor more to invest and want to learn more, click on the link below to get your\nfree report today!<\/p>\n\n\n\n Click Here to Download Our Just-Released July Market Strategy Report<\/a>2<\/a><\/sup><\/strong><\/p>\n\n\n\n ____________________________________________________________________________<\/p>\n\n\n\n Data\nShows Paycheck Protection Program (PPP) Loans Extended Far and Wide \u2013 <\/strong>The\nU.S. government made public this week the recipients of PPP loans, and analysis\nshows that the loans cast a wide net across the small business landscape. More\nthan 90 industry sectors each had 10,000 companies receive PPP loans, with over\n260,000 restaurants and 150,000 businesses in the personal care services,\nmanagement consultants, and legal services also receiving funds. In total, the\nnumber of jobs that were supposedly saved by the loans (jobs claimed by the\nbusinesses receiving loans) hit 51 million, an astounding number if accurate. It\nis unclear what these companies would have done without the PPP money, however.\nFor instance, many companies in the technology sector \u2013 where demand remained\nsteady throughout the crisis and where remote work is common \u2013 may have kept\npayrolls fairly steady even without government loans. There are also certainly\ncases of well-connected businesses with national presence receiving loans on\nthe higher end of the spectrum, in the range of $5 million to $10 million.3<\/sup>\nBecause the program was rolled out so quickly, it is difficult to ascertain\nwhether a significant portion of the PPP money went to businesses that actually\nneeded it. <\/p>\n\n\n\n Will China Live Up to\nIts Trade Deal Commitments? <\/strong>One of the key features of phase one of the\ntrade deal with China was a commitment to purchase tens of billions of dollars\u2019\nworth of U.S. agricultural, manufacturing, and other goods like natural gas,\noil, and coal. So far, China has made only a small dent in its commitments. As\nof May, it had purchased $5.4 billion of the promised $33 billion in\nagriculture; $19.5 billion of the promised $84 billion in manufacturing goods;\nand a paltry $2 billion of the promised $25 billion of U.S. energy (with even\nmore committed for the year 2021).4<\/sup> Of course, China could always\nramp-up its purchases heavily in the back half of the year, but doing so in a\nway to reach the targets across the board seems unlikely at this phase. The\nquestion for investors is, will the trade deal break down as a result and snap\nthe U.S. and China back on economic relations that have already soured\nsignificantly in light of the trade war and pandemic? This will be an issue to\nwatch closely in the second half of 2020. <\/p>\n\n\n\n News Keeps Getting Worse, and Markets Keep Going Up. How?\n<\/strong>Looking back at the S&P 500\u2019s -34% plunge from its February highs, it\nis easy to wrap one\u2019s head around why the<\/p>\n\n\n\n market fell so quickly and sharply. The pandemic forced a\nglobal economic shutdown, driving developed economies around the world deep\ninto recession. As job losses continue to mount, the stock market has surprised\nmany with its powerful bounce since March 23. How could the market be rallying\nso convincingly amidst all of the current economic pain?<\/p>\n\n\n\n In our just-released\nJuly Market Strategy report,5<\/sup> we take a look at why the markets keep\ngoing up even in the midst of the current pandemic, job losses, and economic\nshutdowns. We will also take a look at possible projections for the S&P 500\nthis year and beyond, while offering readers some advice for navigating\nuncertainty in the current environment.<\/p>\n\n\n\n If you have $500,000\nor more to invest and want to learn more, click on the link below to get your\nfree report today!<\/p>\n","protected":false},"excerpt":{"rendered":" Paycheck Protection Program details released, manufacturing and services improve, China trade deal questions<\/p>\n","protected":false},"author":3,"featured_media":7426,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[71,73],"tags":[],"class_list":["post-8741","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-private-client-group","category-steady-investors-week"],"acf":[],"_links":{"self":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/8741","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/comments?post=8741"}],"version-history":[{"count":1,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/8741\/revisions"}],"predecessor-version":[{"id":10574,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/8741\/revisions\/10574"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/"}],"wp:attachment":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/media?parent=8741"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/categories?post=8741"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/tags?post=8741"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}