Merch Store

COVID-19 UPDATE: Not all cases created equally. Market is telling us it is comfortable with faster testing

Click HERE to access the FSInsight COVID-19 Daily Chartbook.

Financial markets, in my view, are heavily linked to macro trends, particularly the path of COVID-19.  While many people might disagree, a simple way to test is whether a rotation into "cyclical" and "epicenter" stocks will take place once we get conclusive improvements in trend.  FYI, we will be following a shortened publication schedule this week:- Monday morning- Tuesday morning- Wednesday morning- Thursday morning (9/3)Labor Day holiday --> no reports Friday and Monday - Tuesday morning (9/8)STRATEGY: Epicenter stocks barely "budged" last week...The most interesting development over the past week is the market's "rethink" around cases:- first, we are seeing cases rise due to "back to school," particularly large outbreaks at colleges- second, the NY Times had a story over the weekend about how PCR tests might be overly sensitive and 90% of "positive" tests barely had virus- third, US deaths are fallingAnd if this is true, that markets and Americans are beginning to look "past cases," we are in a situation similar to April and May.  If we look at the chart below, that was a period of explosive outperformance of epicenter stocks vs FANG.  For epicenter, we are using the ETF SPHB.- as shown be...

Unlock this article with a FREE 30-Day Trial!

No Credit Card Required! Limited time only!

An FSI Pro, or FSI Macro subscription is required in order to access this content.

*Free trial available only on a monthly plan

If you are already a member at FS Insight, please Sign In If you don’t have a subscription to FS Insight yet, you can sign up below.

Disclosures (show)
complimentary articles / month
FS Insight Guest PASS

Our FS Insight Guest PASS offers you 3 complimentary research reports every month.

You can unlock 2 more articles by joining our newsletter!

You have reached the maximum amount of complimentary reports for this month.
You will receive 3 more complimentary reports as of the 1st of July.

Don't Miss Out
First Month Free