Stocks Futures are Rising with Hope for Reopened Economies

April 9, 2020
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Thursday could be a positive day for American investors. European stocks traded higher during the opening hours today, with the hope that some of the world’s key economies are getting closer to reopening.

The Stoxx Europe 600 index was up 1.7% in the morning and is now up 13% for the month so far. U.S. futures are also trending upwards ahead of the market opening. Dow Jones Futures are up 0.22%, while S&P 500 Futures are up 0.03%.

While the numbers aren’t hugely impressive, they are a sign that investors are getting warmer in the current bear market. The global Coronavirus infection growth rate fell yesterday, and this has created some much-needed optimism.

Coronavirus Case Growth is Decreasing

Positive news surrounding the ongoing Coronavirus pandemic was the main driving force behind the stock movement in Europe. The global new-case growth rate declined from 6.3% to 6.1%. In the United States, new-case growth fell from 9.1% to 8.7%.

These numbers still aren’t ideal, but they do indicate that we are heading towards the downward end of the infection curve.

Other factors also played into more confident European stock markets. European leaders are now discussing how they will reopen their economies and ease lockdown measures. While no timeline has been provided by any major government, simply talking about easing the current restrictions is good news.

In the United States, White House aides have engaged in planning sessions to potentially reopen the U.S. economy as early as May.

Of course, nothing is confirmed yet, and the situation could worsen without notice. Investors can at least have confidence knowing that people are working to ensure a smooth transition back to normality once the time is right.

Congress Will Inject More Money into Small Businesses

The U.S. Senate announced this week that it will add up to $250 billion to the small business loan program that was included in the recent $2 trillion stimulus. This will provide more security to the most vulnerable segments of the economy.

All these factors could create a perfect environment for positive stock movement. During this volatile period, investors should look for bargain opportunities, avoid reactive emotional buying, and aim to build portfolios that are ready for upside after the Coronavirus crisis.

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