The Fragreport

A timeline of actions taken by the Federal Reserve and Federal Government in addressing the economic impact of the coronavirus (COVID-19).

An underlying characteristic of financial markets is that they are driven by the actions of human beings. Even in the age of algorithmic trading and computerized models, human behavior remains a constant with investing.

In light of recent volatility related to the outbreak of the coronavirus, we at MCF Capital Management wanted to share our views and considerations as these developments continue to effect markets.

Investors' October Fears Not Realized. Historically markets perform worse in September than in month of October. Recent moves to cut rates by the Fed signals a more responsive monetary policy. This year the market avoided a sell-off and a crash only to deliver positive returns across the major market indexes which led to new all-time highs for both the S&P 500 and Nasdaq Composite.

Trade Drama and Media Distractions, the Fed is still key. We continue to draw investors’ attention to the impactful actions of the Federal Reserve on equity markets. Investor sentiment may be low, but we believe economic data, Fed moves, and developments on the trade front offer positive outlook for equity markets.

Recession fears, data indicates otherwise. We continue to believe that the direction of the financial markets largely lies in the hands of global central banks and more specifically the US Federal Reserve. Despite “recession talk” being distributed in the media, we believe economic data continues to make the case for economic expansion.