InvestNow News – 8th May – Devon Funds – Monthly Investor Report April 2020
What a month it was
The strength of the recovery in equity markets over the past 5-weeks has been extraordinary. In fact, for the US S&P500, April was the strongest month of returns since January 1987. This has occurred at a time when governments, central banks and businesses are navigating the myriad of challenges associated with COVID-19, and yet investors have essentially been looking through the short-term economic uncertainty and have been actively buying stocks. The recent low in markets occurred on March 23rd. Since that date, both the New Zealand NZX50 Index and Australia’s ASX200 have rallied more than 20%. These performances have confounded many financial commentators because of the apparent disconnect between our listed stocks and the undeniable challenges being felt in the real economy.
As we commented on regularly during April, investor confidence has been buoyed by the massive fiscal and monetary stimulus that has been pumped into the market. Interest rates have been slashed and policy makers have committed to do whatever is necessary to ensure that economies survive. This is no small task. Numerous companies have recently presented their assessments of the economic and operating challenges that lie before them.