“Fed Offers QE Infinity, Senate Gives The Heisman While Amazon, Netflix & Zoom Fly” Vista’s Daily – March 23, 2020

The Federal Reserve announced another round of new stimulus programs with the goal of keeping the market working for us today as the coronavirus epidemic was confirmed to have spread to 350k of global cases and 15k deaths and the WHO director stating that it is accelerating while businesses across the US continue to shutter. Some are calling the measures “QE Infinity” as they are deploying an open-ended commitment to keep buying assets of many kinds. Another one of the interesting measures is their Main Street business lending initiative, which is targeting to keep credit flowing. The Fed is also buying investment-grade securities in primary and secondary markets and through exchange-traded funds including corporate bonds. The Fed stated that they are deploying “in the amounts needed to support smooth market functioning and effective transmission of monetary policy to broader financial conditions and the economy.”  The Senate, on the other hand, gave us the proverbial Heisman as it failed to move forward its stimulus bill and the political games continue but may surface again on Friday as last reported.

At the close of trading, all markets moved lower again today. The S&P 500 dropped by -2.93% as 10- of even sectors were down as only the consumer discretionary sector moved up. The Dow subtracted -3.04% while one of its components, Boeing (BA), surged +11.17% today after announcing that they had shut down production at its Puget Sound operations and was rumored to be part of a government bailout package. The Nasdaq faired relatively well ending down just -.27% & the Russell 2000 lost -1.13%.

The FAANG stocks lost ground today except for its coronavirus related plays Netflix (NFLX) & Amazon (AMZN). Netflix (NFLX) closed at $360.27/share, up by a sizable +8.24% as speculation rose around its prospects during the containment should continue to rise as the world has increased its amount of regular couch potatoes watching move is sans sporting events and more time on their hands. Amazon (AMZN) closed at $1,902.83/share, up by +3.07% as they are believed to be benefitting from the increased online ordering of food from its Whole Foods operations and various products, including toilet paper,  in this contained world. The balance of FAANG Stocks took it on the chin today. Apple (AAPL) closed at $224.37/share down by -2.12%, Facebook (FB) closed at $148.103/share, -1.09%, & Alphabet (GOOG) closed at $1,056.62/share, -1.46%.

Oil jumped +3.8% closing at $23.49/bbl. U.S. Treasury yields moved lower today. The 2-yr yield moved down aggressively by 8 basis points to .29% & the 10-yr yield moved lower by 17 basis points to .76%. The U.S. Dollar Index weakened -.3% to 102.48.

Another standout today was Zoom Video Communications, Inc. (ZOOM) as it jumped +22.22% closing at $159.56/share. Investors are speculating on their growth as students, adults and businesses that are stuck at home continue to turn to it as a technology of choice to conduct virtual classes, gatherings/parties & meetings. 

Please remember that we can get ahead of the coronavirus if we stay committed to social distancing as a nation and as a world. 

Economic Reports

On Monday, nothing of significance was reported.

Investing & Inspiration

“I believe the returns on investment in the poor are just as exciting as successes achieved in the business arena, and they are even more meaningful!” -Bill Gates

“Every portfolio benefits from bonds; they provide a cushion when the stock market hits a rough patch. But avoiding stocks completely could mean your investment won’t grow any faster than the rate of inflation.” – Suze Orman

“The tax on capital gains directly affects investment decisions, the mobility, and flow of risk capital… the ease or difficulty experienced by new ventures in obtaining capital, and thereby the strength and potential for growth in the economy.” – John F. Kennedy

“If all the economists were laid end to end, they’d never reach a conclusion.
-George Bernard Shaw

“The riskiest thing we can do is just maintain the status quo.
I get up at 4:30 in the morning, seven days a week, no matter where I am in the world. I think it is important for people who are given leadership roles to assume that role immediately. What I’ve really learned over time is that optimism is a very, very important part of leadership.” Bob Iger, Ceo of Disney

“There are old traders and there are bold traders, but there are very few old, bold traders.”-Ed Seykota

“Let this scenario play out on its own, in its own fashion. As you watch it unfold, you will soon be grateful that you choose the peaceful path. Remember — those who live by the sword, die by the sword.”

“As long as you enjoy investing, you’ll be willing to do the homework and stay in the game.” -Jim Cramer

“I rarely think the market is right. I believe non-dividend stocks aren’t much more than baseball cards. They are worth what you can convince someone to pay for it.” -Mark Cuban

“Michael Marcus taught me one other thing that is absolutely critical: You have to be willing to make mistakes regularly; there is nothing wrong with it. Michael taught me about making your best judgment, being wrong, making your next best judgment, being wrong, making your third best judgment, and then doubling your money.” -Bruce Kovner

“The policy of being too cautious is the greatest risk of all.” -Jawaharlal Nehru

“The only true test of whether a stock is “cheap” or “high” is not its current price in relation to some former price, no matter how accustomed we may have become to that former price, but whether the company’s fundamentals are significantly more or less favorable than the current financial-community appraisal of that stock.” -Philip Fisher

“I learned to avoid trying to catch up or double up to recoup losses. I also learned that a certain amount of loss will affect your judgment, so you have to put some time between that loss and the next trade.” -Richard Dennis

“The four most dangerous words in investing are: ‘this time it’s different.” -Sir John Templeton

“Money doesn’t make you happy. I now have $50 million but I was just as happy when I had $48 million.” -Arnold Schwarzenegger

Tomorrow

Tomorrow’s significant economic data report schedule will include the following:

• The New Home Sales Report for February