After the best month in 33 years, what’s next for stocks?

May 1, 2020, 9:25 AM UTC

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Happy May Day, everyone. It will be a lighter than normal trading session as stock exchanges across Europe and Asia are closed for International Workers’ Day. But fear not, dear international worker, Bull Sheet is on the job.

Let’s see who’s open and trading.

Markets update


  • Markets in Japan, Australia and Singapore were all in the red as weak manufacturing data sinks investor sentiment.
  • China, Hong Kong and South Korea are closed today.


  • The lone major index operating today is London’s FTSE. It should have taken the day off. It’s down roughly 1.8% at the open, and falling.
  • The ECB’s Christine Lagarde warned yesterday that Europe is “facing an economic contraction of a magnitude and speed that are unprecedented in peacetime.” Coronavirus could shrink the bloc’s economy by as much as 12% this year, the central bank now forecasts.
  • The ECB, meanwhile, has turned to a familiar tool—negative interest rates—in its latest bid to jumpstart the stricken economy.
  • Ryanair will cut 3,000 jobs as passenger numbers plummet. CEO Michael O’Leary told Bloomberg TV this morning that the outlook will be pretty turbulent for the next 12-18 months, but he sees limited flights resuming in July.


  • The Dow, S&P 500 and Nasdaq point to another down day. Falls of 2% at the open are on the cards. But, wow, what an April! The S&P just came off its best month since 1987.
  • Today, investors are nervously eyeing Big Tech. Apple, for the first time in a decade, skipped offering a forecast for the current quarter and Amazon warned it may post a loss this quarter. Both are trading lower in the after-market.
  • There are somewhat clearer skies above Boeing HQ this morning. The planemaker announced it launched a mega $25 billion bond offering, which would negate any need for state aid.
  • Some good news in retail land. Macy’s will reopen some stores next week in the hopes of fully returning to business by mid-June. “We’re going to be smaller, we’re going to be more levered but we have a path forward,” CEO Jeff Gennette told Fortune‘ s Phil Wahba.


  • Gold is down.
  • The dollar is up.
  • Crude is clinging to slight gains, as I type, extending its rally for a fourth straight day. Brent is back above $25/gallon.

By the Numbers

21.1. The Nasdaq closed yesterday at 8,889.55, good for a 21.1% gain in April. That was the best performance of any major index in the world over the past month. Those levels could be tested today with Amazon, Apple and Twitter all down sharply in after-hours trade. But the transition to a work-from-home economy certainly benefits Big Tech in the longer run, as CIOs tell Fortune‘s Anne Sraders. Elsewhere, the S&P 500 hit a 7-week high this week. It finished April up nearly 13%, its best month since the Reagan years, 33 years ago.

30.3 million. We come back weekly to this grim data point. 30.3 million workers in the United States have now filed for unemployment benefits over the past six weeks. Yesterday’s tally of 3.8 million jobless claims filed pushes the real unemployment rate to 23%, a destruction of jobs we haven’t seen since the Great Depression. This number is as ugly as it is misleading. Unemployment rates notoriously underestimate the health of the labor market. Adding to the problem: states were unprepared for the deluge of claims, meaning all kinds of jobless Americans are still uncounted. My colleague Lance Lambert has been following this story for weeks. As Lance’s chart below shows, we may be seeing a flattening of the curve, but these are still striking numbers.

10.26. At one point on Tuesday, U.S. crude—the West Texas Intermediary—was painfully close to trading in the single digits. It hit a low of about $10.26 before making a huge comeback. It’s now trading above 19 bucks, a gain of more than 85% in the past three days. These future contracts are among the most heavily traded in the world, and they’re as volatile as ever.


One of the things on my to-do list this weekend is to get our car—a 2005 Toyota Yaris—moving again. A real clunker, the poor thing has been run into so many times by distracted Roman drivers over the years it’s beginning to resemble a dinged-up soda can on the left side. And the front-end ain’t much better. But the engine is a thing of beauty. Turn the key, and she purrs to life. Augusto, our Roman mechanic, tells me, in a tone that borders on an order, not to trade it in. Until it dies, he adds.

So I was a bit surprised when I got in a few weeks ago, turned the key, and, well, not much. The dashboard lit up, but the engine wouldn’t turn over. Probably the battery, I figured. But then I remembered I’d just changed the battery last spring. Maybe it’s the weather. Diesels are notoriously sluggish starters in the winter. Wait, this is Rome. That can’t be the issue. I got out of the car, resolving to sort it out when I had more time. With Augusto not on duty, I’m on my own.

And then just overnight somebody sent me an article about a rash of neglected cars mysteriously not starting. The culprit: rats. When cars sit idle for a while, rats apparently like to climb in and nest in the engines. It’s not a cuddly arrangement. They like to chew on the wiring. They “get a certain amount of comfort” from it, Michael Deutsch, an urban entomologist told the New York Times.

Could a four-legged critter with strong incisors be the source of my problem?, I wondered over coffee this morning. My ‘hood in Rome is nothing like my old stomping grounds in New York where rats were a fairly common sight. But we do live near the Tiber, which has had its share of rats since Caesar’s day. And, besides, animals returning to town in droves has become a global phenomenon with humans under lockdown.

I’ll find out, I guess, this weekend. I’ve got my jumper cables. I’ll be carrying a ski pole (because I don’t own a canoe oar). And I have Augusto on speed dial.

Wish me luck.


Have a nice weekend, everyone. I’ll see you here on Monday.

Bernhard Warner

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Today's reads

Forget earnings. We’re a little more than half-way through earnings season. Ordinarily, we’d be focused on earnings beats (or misses) and outlooks. Coronavirus has obliterated that calculus, however. Instead, there’s a whole new set of tells we should be looking for to assess the health of the S&P’s biggest stocks. Fortune’s Anne Sraders pulls together some invaluable pandemic investment advice from CIOs.

Pay-me loans. The European Central Bank on Thursday introduced a radical fix to get credit flowing to the euro zone’s embattled companies: paying banks to loan out money. Specifically, it will begin offering loans to Europe’s hobbled banks that carry an interest rate as low as -1%. Yes, negative. The funds can then be lent to companies and households. I wish the ECB would get into the mortgage business.

Animal frackers. Fortune’s Shawn Tully takes us on a deep dive into the rise and fall of America’s shale producers—the frackers. The fate of this upstart sector is tied to the precarious price of American crude. And we know that West Texas Intermediate, or WTI, doesn’t look good at the moment. Cheap oil will trigger a wave of bankruptcies and layoffs. But don’t write off the fracking revolution just yet. “Shale,” Tully writes, “can be profitable, but only if it barely grows.” Here’s what he means by that.

Market candy

Movie night

I love this story from Vilnius, the capital of Lithuania. Organizers of the annual Vilnius International Film Festival found an ingenious way to give local cinephiles their movie fix. They’re hosting movie night at the city’s big airport. Or just outside. It’s an old-style drive-in movie experience. Right on the tarmac. The pictures are great.

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