Where Is the Stock Market Headed in the Second Half of 2020?

There’s no denying the first half of 2020 was a wild one from but a societal and financial standpoint.

Historically speaking, “v” bottoms bode well for future returns over the next 6-12 months. The typical six-month return for the index is around 6%.  This means…

 it is a good time to buy stocks.

On the financial front, we’ve witnessed the steepest and quickest bear market, a full 35% decline in a mere five weeks, only to only be followed by the best 50-day performance ever; a rocket right back up to highs.  If there ever was a picture of a ‘V” bottom in the finance books the chart from March to June would be prominently placed.  On the other hand, the stock market recovery has left plenty of pundits scratching their heads as they point to still record unemployment, souring bankruptcy filings, and the mere fact the Covoid-19 virus is still spreading causing not just delays in reopening but actual backtracking of re-closing.

So, what gives? 

We’ve had a variety of discussions regarding the disconnect between Wall Street and Main Street and have tried to make clear how the stock market, which mega-cap stocks such as “APPLE (AAPL)” “Microsoft (MSFT)” and “Amazon (AMZN)” comprise some 20% of the “SPDR 500 ETF (SPY)” and a whopping 42% of “Nasdaq (QQQ – Rated “A” – Strong Buy)”, these are what moves the indices;  the local diner and barber are but a mere pimple on the global financial stage.

To beat a dead horse, while the stock market has recouped, much of its losses from the first half of the year, it’s important to keep in mind that the market is not the economy. Financial markets tend to…

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