US stock exchanges are one of the big winners of this pandemic period. Key indices in these financial markets again posted record gains in the third quarter of 2020. The S&P 500 and the Dow Jones Industrial Average gained 8.5% and 7.6% respectively over the period. Stronger gains were recorded in the first two months of the third quarter, resulting in the best two-quarter performance since 2009 for U.S. stock exchanges.
The two benchmark indices are up more than 26% since the end of March. The Nasdaq Composite jumped 11% in the third quarter and 45% in the last six months; its biggest two-quarter gain since 2000, a V-shaped recovery.
However, this development on the US stock markets contrasts with a much slower recovery of the US economy as a whole. Unemployment indeed continues to fall but at a rather slow pace. Also, the attractiveness of listed companies has not been the result of a particular business strategy on their part.
Having benefited from widespread assistance from the U.S. government, many households and businesses that could not spend the resource immediately chose to reinvest it. Also, faced with a debt market that had become unprofitable although it had grown in volume, investors turned to the shares of listed companies to preserve the value of their capital.
Investors on the U.S. stock exchanges have looked for the slightest opportunity for added value. They were first into technology stocks and by the end of September, it was real estate loans.
Indeed, many Americans are now convinced that teleworking will be the new norm. The demand for real estate has increased as well as the demand for vehicles, as millions of people want to avoid public transport, which is at high risk of spreading the virus.
Idriss Linge
• Global coffee consumption projected to hit a record 169.4 million 60-kg bags in 2025/2026, up from...
• Algeria grants commercial 5G licenses to top three telecom operators: Mobilis, Djezzy, and Ooredoo...
• Investors seem to keep focusing on yields, which are high for the moment• New Leadership might see...
• Kenyan President William Ruto signs strategic partnership with UK Prime Minister Keir Starmer to b...
• IFC teams up with AfDB and Nigeria’s EbonyLife to assess a new fund for African cinema• Sector cou...
• Morocco began expanding Casablanca Airport to raise capacity to 35M passengers by 2029• The $1.7B project supports the “Airports 2030” plan to...
• DRC extended its cobalt export ban to September 2025 due to high stock levels.• Major producers like CMOC face delivery issues; supply risks remain but...
• Eskom restored Medupi Unit 4 early, adding 800 MW and helping end load-shedding• Coal still dominates South Africa’s power, slowing the energy...
• Ethiopia completed the $4B Grand Renaissance Dam to boost power capacity and energy independence• Egypt and Sudan fear water supply risks, with no...
The Gerewol tradition is a fascinating ritual celebrated by the Bororo Fulani, a nomadic community primarily located in Chad and Niger. This annual...
In northern Ethiopia, in the Tigray region, lies Axum (also spelled Aksum), an ancient city that once stood at the heart of one of Africa’s most powerful...