COVID-19 UPDATE: Start of the final month of 3Q2020. COVID-19 receding as positivity rate falls to 4.3%... new cycle low
Click HERE to access the FSInsight COVID-19 Daily Chartbook.
FYI, we will be following a shortened publication schedule this week:
- Tuesday morning
- Wednesday morning
- Thursday morning (9/3)
- Friday morning (9/4) NO REPORT
- Monday morning (9/7) NO REPORT
- Tuesday morning (9/8)
STRATEGY: Start of the final month of 3Q2020
The case data for Monday was overall positive as daily cases came in at 31,108, a new cycle low and down 1,500 vs 7D ago. It would have been better except for 1,100 cases reported by Tennessee attributable largely due to a prison outbreak, and the test positivity rate is 4.3% and near cycle low.
We will write more extensively Tuesday night about how we see case evaluation evolving ---> a case is not a case --> good
- But the 4 epicenter states, FL, CA, AZ, TX, or F-CAT are seeing cases still collapse (AZ has the slowest case growth in the USA now)
- NY tristate is under control and remains so
- so the back to school surge is happening in states with low case prevalence
Given stocks have been strong in the first two months of 3Q2020 and now strong for all of 2020, we think there could be a FOMO rather than a "slope of hope" as cash balances remain elevated with nearly $4.7T of cash on the sidelines. And in the final month of 3Q2020, investors would likely buy any dip.
- COVID-19 trends are improving, even as back to school, particularly colleges is causing another mini-wave
- Global economic data is strengthening, even from China and Europe
- Congress has to vote on a budget in October and our policy strategist, Tom Block, sees stimulus linked to this
- Equities remain healthy and we see upside if economic momentum improves
This latter point needs to bear out this week. So, Friday's payroll report (August) will be important. The Street is looking for 1.4 million jobs added in August.
POINT 1: Daily cases fall to 31,108 and would be sub-30,000 except for TN prison cases...
Daily cases came in at 31,108 which is ~1,500 compared to last week. And US cases would have likely been sub 30,000 today except for a +1,151 surge reported by Tennessee. And this is largely due to ~1,000 cases being reported by one prison.
Choose one of our yearly plans to save nearly 15%
- Macro + Crypto
- Macro + Crypto