BCA Weekly Commentary 5/08/20

Updated: Jun 12


SUMMARY. This week we continued to see states beginning to reopen their economies in a limited way. Unemployment claims continue to be very high which we are monitoring closely as economy reopens. We expect more of a sloped "U" recovery vs sharp "V" in the US as it will likely take several quarters to regain growth footing. Initial signs from company earnings calls is that orders rates in China are beginning to return to pre Covid-19 levels which is a very encouraging sign. We remain focused on the pace of states reopening as well as drug therapy/vaccine trials which hold the fastest way to reduce fear so economic growth can resume.


INVESTMENT IMPACT. Over the past 2 weeks our model portfolios remained little changed as we remain weighted towards those companies who's valuations (in our view) have been slow to reflect the reopening of the economy. We remind clients, it was always our belief that the virus would defer growth not end it and was reduced growth is transitory not permanent. Our conviction of this was partly tied to our extensive research on drug therapies which we thought would work to thwart the spread and reduce deaths. Our latest model performance as of 05/08/20 has been posted on our website.


For more insights see our website and disclosures found there at BCA. As always contact us for further explanation of how these events can affect your finances.

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