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Stock market commentary March 25, 2020

US stock futures erase their previous gains, now focus is on the stimulus package reached for the US economy

The US stock market today will place importance on the stimulus package reached to support the US economy and on the economic news released the durable goods orders, before the open of the trading session. The forecast for the monthly durable goods orders figure is -1.0%. Any worse than expected reading may be negative for stocks today.

The stock market continues to be to a very large degree uninvestable as volatility remains at very high levels. As of 8:05 AM, Wednesday, March 25, 2020, Eastern Time (ET) the Vix index is at 68.77 +7.18(+11.66%). This sustained extreme volatility needs to be reduced so that a more clear picture is made about whether a bottom was formed in the previous trading sessions or not. Any decisions for stocks to buy or stocks to sell now favor short-term trading. This is because strong gains tend to give way to profit-taking selloffs, and we need to see the real implications of the coronavirus effects with the actual release of stock earnings.

NIKE, Inc. (NKE) stock earnings

“Nike, Inc (NKE) reported better-than-expected quarterly revenue as digital demand offset a sales decline in China resulting from the coronavirus shutdowns.

Revenues for the third quarter ended Feb. 29, rose 5% to $10.1 billion as overall digital growth increased 36% during the same period, the company said late on Tuesday. Greater China revenues dropped for the first time in 22 consecutive quarters of double-digit growth, declining 4% during the period. Diluted earnings per share slid 22 percent to $0.53.”

Stock market data: https://finance.yahoo.com/news/nike-beats-quarterly-revenue-estimates-074333827.html

Nike stock closed at 72.33+9.53 (+15.18%), on Tuesday, March 24, 2020. If we see soon more companies reporting better than expected earnings, then there could be great chances for a stock market bottom to have been made at these price levels. The fundamental news and other news related to fiscal policy, and hopefully any positive news related to the coronavirus outbreak are key catalysts.



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