By the end of trading on June 5, 2020, amid the riots (because the protests have been overshadowed) and a pandemic (that disappeared when the riots started – very curious huh) the market rebounded to almost 27,000 for the Dow Jones Industrial Average. Job gains baffled experts who were predicting more job losses. Instead, the market added around 2.5 millions jobs for the month of May 2020. For context, the DOW was at 18,000 election night 2016. Before the pandemic, the DOW was hovering close to 30,000.
The fundamentals of the US economy was strong before the virus hit. Just like you’re better off having reserves in the event you get sick, so to is the economy. The market was continually adding jobs until first, people decided to hole up even before any order of shelter at home was given and two, a formal shutdown was announced. Unlike at a normal start of a recession, the economy was still at a growth trajectory before it was artificially halted. We will now wait and see if these gains can be sustained. At time of writing, New York, California, Illinois and a few other states remain shutdown. Those states add up to around 20% of GDP.
Grateful Immigrant 