Will the Stock Market Continue its Climb in April?

1. Will the Stock Market Continue its Climb in April? The stock market had a great April after the torrid March it underwent. That has raised hopes for investors of a potentially brighter year. Trade Zero 204 Church Street Sandy Port West Bay Street Nassau Bahamas www.tradezero.co+1.954.944.3885

2. Has the stock market bottomed out? This MarketWatch report claims that data taken from 2009 all the way back to 2001, 1990, 1982, 1974 and 1970 would indicate so. It states that the economy would already have gotten to the lows in those bear markets, as the chart below, describing bear markets and jobless claims, indicates. (Img source: https://www.marketwatch.com/story/why-the-march-low-for-the-stock- market-may-hold-even-though-another-test-may-come-2020-05-01?mod=home-page) May 2020 Versus the Month of May in Previous Years The adage, “Sell in May and go away” may not quite be relevant to the situation now, according to a MarketWatch article. This usually applies to the seasonal pattern of the market by which it underperforms, on average, from May through October. Markets have had a strong April after some vigorous selling caused by the pandemic. The major indexes have all gained following a torrid March, and investors apparently believe that Covid-19 would eventually subside and, despite the massive devastation caused to the jobs market, the economy will get back to work. Besides, the table below clearly shows that the strategy hasn’t always been true, though it has worked from a long-term perspective. www.tradezero.co+1.954.944.3885

3. (Table source: LPL Research. Image link: https://www.marketwatch.com/story/after-a- blockbuster-april-for-the-dow-and-sp-500-is-sell-in-may-in-the-coronavirus-era-a-smart- strategy-2020-04-30?mod=home-page) In May 2019, stocks experienced a sharp pullback. (Source: https://www.cnbc.com/2019/05/31/the-markets-drop-in-may-felt-serious-but- it-is-normal-for-stocks.html) The major chip makers also had a crushing May 2019. www.tradezero.co+1.954.944.3885

4. (Source: https://www.cnbc.com/2019/05/31/the-markets-drop-in-may-felt-serious-but- it-is-normal-for-stocks.html) But in seven of the past eight years, the six months starting from May, called the sell period, have produced promising gains. Major Indexes Had a Great April Despite the fact that around 30 million Americans filed for unemployment benefits as a result of the lockdown brought about by the Covid-19 pandemic in April, the S&P 500 experienced a 12.7% surge that month! This has been the best April for the index since the Great Depression and the best performance of any month since January 1987. In fact, it’s been the best April for both the Dow and the S&P 500 since the time of the Great Depression. March 23 Expected to Be the Lowest Point According to prominent market strategist Jeff Hirsch, the late March lows experienced by the market could, in all likelihood, hold. The latest unemployment claims figure is 3.8 million, which is still off the 6.9 million peak. The March 23 low could be the lowest point, but even then, Hirsch doesn’t reckon that we could be seeing new highs for the coming 6 months. In fact, he does not expect new highs for a significant period of time. While treatments and vaccines are being developed for Covid-19, Hirsch believes there still is uncertainty as to when the economy will get back to normalcy. An LPL Financial senior strategist believes that the stock bounce witnessed in April could well bring about a pullback in the months from May to October. With zero commission trading, one can get started in stock trading easier. www.tradezero.co+1.954.944.3885