Your Wednesday Market Blip 3/18/20

Your Wednesday Market Blip 3/18/20

Stocks have been trading with big up days and bigger down days as uncertainty reigns supreme. At the close today Boeing and the airline industry look closer to some sort of an aid package from Uncle Sugar. Shares of grocery stocks continue to trade higher and network companies were up as the need to have systems in place that allows workers to go online is now seen as a valuable tool. At the close the Dow was down 1,338 at 19,898 on heavy trading volume. Both BTS and IBD remain on the sidelines.
Coronavirus testing is about to ramp up according to the White House as mobile testing stations have been set up in 10 states and new high throughput automated tests at private labs are coming within days…supposedly. Once private labs were allowed to test starting late February they have gone from zero to 97% of all testing done on a daily basis. The new faster tests are expected to allow labs doing 60 tests per week to do thousands per week. Once this wall of testing hits we will most likely see a spike in cases but the data from this should help to ease the unknown.
Economists are now calling for a global recession. Brian Wesbury at First Trust thinks the US will see a 10% contraction in Q2 before rebounding later this year when bars open up again. He cites the 1957/58 Asian flu as precedence since the economy was hit hard in Q1 but by the end of the year was growing at 4% plus rate.
Shares of Tesla went below $400 per share after the State of California ordered the Fremont plant closed. Tesla has been trying to keep the factory going and Elon Musk had declared the company “national critical infrastructure but the Alameda sheriff said it was not an essential business and that they go a minimum basic operation level. Meanwhile Tesla delivered its first Model Y two days ahead of schedule.

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