Markets Taking Trump’s COVID in Stride
By: Jake Willms, Quantitative Analyst
As stocks tumble all over the world today in response to President Trump and his wife’s positive COVID-19 test results, it’s only natural to assume that things are trending down. I present to you another viewpoint.
Since the early morning sell-off, major indices have mostly settled back to near-zero as of my writing this, with the S&P 500 down 0.6% and the Dow Jones down only 0.02%. In fact, some are posting modest gains today, with the Russell 2000 up 0.50%.
What should investors expect moving forward?
First off, I personally think that seeing the U.S. president contract COVID-19 will add a new level of seriousness to the claims for masks and social distancing by medical experts and government officials alike. Seeing your president catch the virus, perhaps the last person one would expect to contract such a thing, may resonate with people. This will surely put the U.S. treatment under the spotlight as well.
Second, progress towards a new stimulus bill may soon find new ground in response. It is reasonable to infer that politicians may feel differently after learning of a virus spread amongst key politicians. According to Nancy Pelosi, the positive test “changes the dynamic” and she expresses optimism about finishing a deal soon.
Expect increased levels of market volatility in the coming days as the world watches on for updates. Wishing him and his wife a speedy recovery.