EU Stimulus Approved, European ETFs Rally & Markets Close Mixed – Daily Financial News Summary For Tuesday, July 21, 2020
Another day of musical chairs in the markets as the three main market indexes shifted again. The Nasdaq sunk 0.8%, while the Dow Jones gained 0.6% and the S&P 500 snuck 0.2% higher.
Tech dipped downward from the big Amazon gains yesterday, giving Apple, Amazon, Netflix, Facebook, and Microsoft a 1% loss on the day, while Alphabet saw a 0.5% loss.
As the markets closed, United Airlines announced a second-quarter loss of $1.6 billion. While the stock got jumpy during the announcement, at the time of publishing, the share price was up about 2% in after-market trading. Meanwhile, Delta closed the day up 0.8%, American Airlines stayed even with no gains on the day at market close, and Southwest Airlines was up 1.94% on the day.
The European Commission approved a 750 billion euro stimulus to help the European Union countries and industries that have been impacted by Coronavirus. Meanwhile, the United States anxiously awaits plans for next steps in Coronavirus relief plans as programs such as the $600 unemployment benefit and other mortgage and rent relief programs reach their expiration dates.
Stock Market Is Overvalued, Expect Square-Root Recovery: Leon Cooperman
The U.S stock market and the economy are lacking many of the underlying principles previously used to explain them historically. Those are sentiments echoed by hedge fund billionaire, Leon Cooperman. He is the chairman and CEO of Omega Advisors, a New York-based investment advisory firm managing over $3.3 billion in assets under management. According to the billionaire investor, at current levels, the market is overvalued, having failed to price in, or factor, some of the developments that signal economic growth stagnation.
“If you go back to your school days — you have a sharp movement down, you have a bounceback, but… the growth rate in the economy going forward will be less than people think,” Cooperman said and predicted the market will see a square-root shaped recovery, similar to his thoughts following the 2009 market crash.