“Texas high court blocks mask mandate in two of states largest counties” – nbcnews.com 08/16/2021
There seems to be a sense that the surge of the Covid Delta variant could become a problem for the stocks in the financial markets. The question becomes, how will it affect the markets and your portfolio? Will it be the same as last year where the markets believe the country will shut down? Last year, we saw online stocks such as Amazon, Teledoc, Pinterest, Zoom, Etsy, soar while stocks such as AMC movie theaters, Starbucks, and Carnival Cruise lose over 30% of their perspective values.
A review of the markets over the last 30-45 days, shows a very mixed bag of stock prices. Individual stocks, such as Carnival Cruise have declined in stock price by 20%. Which, the logical thought process would be that the market believes that there will be a decline in stock prices of Re-Opening stocks. However, stocks such as Starbucks and Chipotle are near all-time high stock values and they are re-opening play stocks. Yet, Clorox is down 12% since July 30, 2021. Amazon is down 9% since July 29, 2021 and Zoom is down 13% since July 7, 2021. All while Covid-19 Delta variant is surging.
What does all of this mean? It means that some stocks that should be doing well because of a surge in Covid-19 Delta are down as well as some stocks that should be down due to Covid-19 Delta are up. It means that anyone who is trying to predict the market based on Covid-19 is not supported by the market response.
There are real concerns looming out there. The market has reacted with large swings to new COVID-19 variants and new understandings of how the vaccines are handling (or potentially not handling) the new variants. The market has reacted to re-opening issues (not enough workers, supply issues, and rising costs) as well as re-closing concerns (increased COVID positives, hospitalizations, and mask mandates). So, which is it? Is the market concerned more about re-opening or re-closing? The immortal words of Forrest Gump, “why can it not be both?” The answers are not simple, as the issues are not simple. As an advisor, I help my clients balance all of these problems because they are all issues.
Is following the most recent market trend, intelligent investing? More importantly, is it intelligent investing for you and your family? If you would like help ensuring your portfolio is prepared for all of the above (and more), please contact me. Our firm can help make sure your portfolio is being intelligently invested for you and your family’s goals.
