Investment Commentary – August 2020
August 28, 2020
Following steep losses in the immediate aftermath of the coronavirus, the stock market saw a swift recovery, making up much of the losses and, in some cases, reaching new highs. Despite the rebound in the stock market, the broader economy saw a historic 32.9% decline in GDP in the second quarter. While we anticipate a return to positive growth in the third quarter, it is unlikely that we will return to pre-pandemic levels of economic activity for at least 6-12 months. We had previously forecast that the economic recovery would be two-phased, with an initial rapid bounce, followed by a more gradual climb. It is clear that we are now in the second phase, but the ultimate trajectory of the recovery remains unclear.