Stocks pared losses but opened lower. Stocks will try to add to their recent advance after the S&P 500 Index’s biggest weekly gain in over 40 years. Coming back from the holiday weekend, and with markets throughout much of Europe closed for the holiday, the morning session has been fairly calm. Investors will remain focused on signs of a peak in COVID-19, treatment development, the latest stimulus measures, and unfolding plans to potentially begin reopening the economy in May. Earnings season kicks off Tuesday.
OPEC reaches a deal to cut production. OPEC leaders and Russia reached a deal over the holiday weekend to cut production after getting remaining holdout Mexico onboard. The move will help offset the severe global demand shock from the COVID-19 pandemic, which was exacerbated by a Saudi Arabia-led global price war, but it may fall well short of the eventual hit to demand from travel restrictions and lockdowns. We think oil could eventually get to where it is economical for US producers to produce—in the $40s and $50s per barrel—but it may take a long time to get there.
Earnings season begins this week. First quarter earnings season kicks off this week with several big banks reporting first quarter results. Due to COVID-19 pandemic, S&P 500 earnings are expected to fall 10%, compared to estimates at the start of the year that called for a 4% increase. This week 40 S&P 500 companies will report quarterly results. We preview earnings season later today on the LPL Research blog.
This material is for general information only and is not intended to provide specific advice or recommendations for any individual. There is no assurance that the views or strategies discussed are suitable for all investors or will yield positive outcomes. Investing involves risks including possible loss of principal. Any economic forecasts set forth may not develop as predicted and are subject to change.
References to markets, asset classes, and sectors are generally regarding the corresponding market index. Indexes are unmanaged statistical composites and cannot be invested into directly. Index performance is not indicative of the performance of any investment and do not reflect fees, expenses, or sales charges. All performance referenced is historical and is no guarantee of future results.
Any company names noted herein are for educational purposes only and not an indication of trading intent or a solicitation of their products or services. LPL Financial doesn’t provide research on individual equities. All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.
This Research material was prepared by LPL Financial, LLC.
Securities and advisory services offered through LPL Financial (LPL), a registered investment advisor and broker-dealer (member FINRA/SIPC).
Insurance products are offered through LPL or its licensed affiliates. To the extent you are receiving investment advice from a separately registered independent investment advisor that is not an LPL affiliate, please note LPL makes no representation with respect to such entity.
- Not Insured by FDIC/NCUA or Any Other Government Agency
- Not Bank/Credit Union Guaranteed
- Not Bank/Credit Union Deposits or Obligations
- May Lose Value
For Public Use – Tracking 1-981476