Citi Personal Wealth Management

An Astonishing April

Monthly Market Snapshot: April 2020

Highlights

Stocks across most markets experienced astonishing gains in April with the S&P 500 posting its best monthly return since 1987. It was the best April performance since 1938. Outside of the U.S., emerging markets rose 9.0% while shares in Europe and Japan rose 4.9% and 5.4%, respectively. The 10-year U.S. Treasury yield was little changed during the month – falling just 4 basis points to 0.64% at month-end.

Incoming economic data have been horrible. However, massive amounts of stimulus, news on potential COVID-19 treatments, and evolving plans to reopen the economy have lifted stock prices sharply. While the rebound in stock prices appears “V-shaped,” the underlying economy may take longer to recover. Particularly on the services-side of the economy.

On April 22nd, Citi’s Global Investment Committee (GIC) moved from a neutral weighting on U.S. small-cap and mid-cap shares to an overweight. Small-caps have lagged, but the GIC is expecting these shares to “play catch-up” if the economy starts to reopen. On the fixed income side, the GIC increased its holdings of both Eurozone and U.S. investment-grade corporate debt.