Take Shelter In These ETFs As Coronavirus Crisis Worsens

Wall Street witnessed a tug of war between the bulls and bears on Jun 25. Federal Deposit Insurance Commission has eased banking regulations for making substantial investments into funds like venture capital funds which led optimism in bank stocks. Big names like JPMorgan Chase JPM, Bank of America BAC and Citigroup C gained more than 3% in yesterday’s trading session.

Meanwhile, the United States saw a record number of new coronavirus cases at 37,077 in a single day on Jun 25. The number of new cases surpassed the previous high of 36,291 recorded on Apr 24, per a CNN report. Notably, states like Florida, California, Carolinas, Texas and Arizona are seeing increasing number of hospitalizations every day.

Given the rising number of coronavirus cases, some states have started to pause the reopening process. In such a scenario, major retailers, factories, restaurants and hotels might have to shut down operations domestically and abroad. Already Texas Governor Greg Abbott has announced the holding back of reopening plans.

Commenting on the current scenario, Carl Tannenbaum, chief economist at Northern Trust in Chicago, has said that “the renewed outbreak will hinder the recovery,” per The New York Times report. According to the World Trade Organisation (WTO), the pandemic resulted in an 18.5% decline in global trade in the second quarter of 2020 (according to a CNN report).

Going on, Fed Chair Jerome Powell maintained a dovish stance in the FOMC meeting, concluded on June 10. He informed that there is no expectation of a rate hike through 2022. The Fed has pledged to continue pumping in stimulus to support the economy and strengthen it. The central bank has also reiterated that the Fed funds rate would likely stay at the 0-0.25% range and confirmed continued bond-buying. The central bank forecasts unemployment rate decline to 9.3% by the end of this year. Though the figure is down from May’s 13.3%, it will be noticeably above 3.5% recorded in February — a near 50-year low.

1 2 3
View single page >> |

Disclosure: Zacks.com contains statements and statistics that have been obtained from sources believed to be reliable but are not guaranteed as to accuracy or completeness. References to any specific ...

more
How did you like this article? Let us know so we can better customize your reading experience. Users' ratings are only visible to themselves.

Comments

Leave a comment to automatically be entered into our contest to win a free Echo Show.