The View from 5th Avenue

The View at Two – 6 August 2020

Cautious, even if green - Heading into Friday, traders are treading carefully after four days of gains in equites.  Congress is still working on their stimulus plan, plus the Nonfarm Payroll data will be reported. Yes POTUS has pointed to a big number, and today’s jobless claims were better than expected (1186k vse 1400k), but the ADP miss Wednesday is still a reminder that this recovery is a work in progress.  The safety trade in Tech (led by the mega caps) is pushing that sector to the best performer list, and also pushing Facebook (FB +5.9%) to a new ATH.  Transportation stocks are also doing well, led by Kansas City Southern (+5%) as it appears a deal for them by Blackstone is getting closer.  On the losing end is Healthcare, getting hit from Becton Dickinson (-8.7%), ResMed (-12.5%) and Dentsply (-7.6%), all of which reported earnings. US treasuries are also ticking higher, with the yield touching 0.5019% for a brief moment.  Investors playing it safe into a potentially volatile Friday.

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