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Market Brief – Thursday 3/19/20

Stocks were volatile in overnight trading but were rising in early trading on optimism existing drugs will cure the Coronavirus. Treasury yields fell slightly in early trading after they announced an increase to $75 billion per day in Quantitative Easing over the next two days. Investors remain optimistic even though state unemployment claims are pointing to national claims rising by over one million next week.

Initial jobless claims came in higher-than-expected at 281k with the four-week moving average for initial jobless claims rising to 232.25k. Continuing jobless claims held steady at 1,701k.

The Philadelphia Fed Manufacturing survey crashed to -12.7 in March from 36.7. Business conditions fell to 35.2 from 45.4, Capex spending fell to 12.0 from 29.8, employment fell to 4.1 from 9.8, prices paid fell to 4.8 from 16.4 and new orders collapsed to -15.5 from 33.6. The Philly Fed data is pointing to a collapse in the U.S. manufacturing sector.

Stocks barely closed in the green as very late selling squashed today’s rally. Treasury yields closed lower as the heavy selling over the past week appears to have subsided with the Fed increasing its daily purchases. Crude oil found some relief as it closed over $26 per barrel after trading as low as $22. Overall, it was a fairly mediocre trading day.