Your Wednesday Market Blip 4/8/20

Your Wednesday Market Blip 4/8/20

Stocks rallied on lower volume thanks to early signs that infection rates could soon peak plus rising chatter about the best way to safely get the economy back to work. At the close the Dow was up 779 points to 23,443. The low volume day indicates investors are cautious as they know that economic data in the coming weeks will be ugly. IBD continues to have markets in rally mode while BTS indicators are mostly defensive which is an upgrade from 100% defensive.
Geekwire reported on an RBC Capital Markets survey showing that online grocery order and delivery trends are bolting higher in the wake of the virus shutdown. The survey found the percentage of grocery shoppers who use online/delivery increased from 22% to 42%. Amazon is getting the bulk of the business while Walmart and Instacart are seeing new highs in demand as well. The survey showed that frequency, basket size and dollar value reached new highs and RBC is working these trends into estimates for the companies that are benefiting the most.
Consumer oriented lending is falling while commercial and industrial loans are spiking. With unemployment rates rising the Mortgage Bankers Association reported mortgage applications declined 17.9% this week with the refi index dropping 19% and the purchasing index falling 12%. The rate for a 30 year fixed mortgage stood at 3.49% up slightly from last week. Banks meanwhile are busy processing PPP applications and Congress is looking to add $250 billion to the program in addition to the $350 billion already pledged under the Cares Act. Early indications are that bank PPP loans are being prioritized to customers with existing lines of credit since they know these people plus it lowers the risk of running afoul of KYC (know your client) and anti-laundering regs.
Troop 100 will host another Zoom Video troop meeting tonight. Most of the scouts are taking advantage of the free time to work on merit badges remotely with merit badge counselors. Trailheads in Washington are closed so there is no hiking plus eagle projects have been suspended until further notice. The local Aurora District reported that its Friends of Scouting annual breakfast in Fremont in early February raised a record $50k for the district.

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