read the entire article at:
https://tickertape.tdameritrade.com/market-news/what-to-watch-june-coronavirus-tariffs-earnings-18125

The stock rally accelerated in April and May amid reopening optimism even as the economy’s brakes slammed. June could help clarify whether the market anticipated things right or got a bit ahead of itself.

A big test for all the recent optimism looms as every state begins the month at least partly reopen. With the most drastic shutdowns over, how long will it take for people to feel comfortable going to a restaurant? What about flying on a plane? Getting a haircut? Economic recovery depends on these everyday decisions made by millions.

Judging from how things have gone thus far in May—when media reports indicated people were generally hesitant to do those things—it’s unclear how quickly life can get back to even a semblance of normalcy. Markets have come a long way on hope, but June could be where hope meets reality.

June could also tell us if the early reopening states started to see a spike in the number of coronavirus cases. With some states now three to four weeks into their reopenings, early June is possibly when new cases would begin to percolate if the virus spiked as more people got out and about.

Any sign of rising caseloads in states like Florida or Texas might get a fisheye from investors, who’ve been bidding up stocks in part on hopes that reopenings can occur without illness increasing. That’s probably why you’ve seen some airline and cruise stocks get a bid lately. However, if cases spike in early states, it could get people worried about governments closing doors to prevent more spread. That would be a big disappointment to the market and might generate some selling.

It’s also possible that once the numbers from early states get sifted, they might tell a more positive story. Whatever they end up showing, those data could be more important than any other numbers in determining how June plays out for stocks.

Washington Looms Large as Second Fiscal Package Debated Another thing we could learn in June is whether fiscal assistance from Washington, which arguably has played a big role since February in propping up the economy, gets augmented or starts to dry up.

For example, the $670 billion Paycheck Protection Program expires June 30. This initiative from Congress has helped small and medium sized businesses muddle through. A bipartisan bill is in the works to extend it, The Wall Street Journal recently reported. However, if that effort breaks down, it might be bad news for small business owners and employees who’ve been depending on these funds. Ultimately that could have an impact on consumer demand, a potential problem for the market considering consumers are 70% of the economy.

As May wound down, the House passed another bill providing fiscal assistance, while the Senate appeared far from eager to follow suit. While this isn’t a political column, it’s possible investors might react unfavorably to Congress denying more aid to states.

Then there’s the worsening war of words between the U.S. and China. Does this accelerate next month, perhaps putting pressure on the high-flying Information Technology sector that’s helped lead the market back from its March lows? Long before coronavirus, the market took a big left hook from the trade war. The war quieted down but didn’t necessarily go away, and some analysts think it could get worse in the months leading up to November’s election. Consider keeping an eye on this in June and beyond.

Monetary policy comes into play June 9-10 when the Fed holds its next meeting. At that point, Fed officials might have to respond directly to questions about rates potentially going negative in the next few months, as the futures market began to indicate in May. Speaking of the Fed, results from its annual stress tests of the major banks are expected to
come out the last day of June.

The Fed has already said it plans to conduct additional “sensitivity analyses” that reflect the ongoing turmoil caused by the virus, Reuters reported. In past years, banks that passed the stress tests typically celebrated by rewarding their shareholders with dividend increases or share buybacks. That seems very unlikely this year.

As Pathogen Rules Roost, Investor Sentiment
Seems Shaky

Those are just some of the external things the market might have to deal with in the weeks ahead. Internally, it’s also arguably a good idea to consider investors’ mood going in.

The booming rally that brought the S&P 500 Index (SPX) back more than 35% from its March lows by late May and raised the Nasdaq (COMP) above water for the year hasn’t been completely convincing. There remain a lot of “weak longs” who might be ready to jump overboard if the boat starts to leak. Data from some banks and market research firms show bearish sentiment remains strong in late May.

Though recent news about progress on a vaccine got an enthusiastic greeting, the market quickly gave up a lot of those gains a day later when a single news article featured some experts casting doubt on the vaccine’s potential. It’s a news-driven market, and any news story can send us down very quickly in a bad way, sometimes without rhyme or reason, due to shaky longs.

The pathogen still rules the roost, so to speak. The economy is in bad shape, and economic data have been horrible. This quarter’s gross domestic product (GDP) might show the worst performance since the Great Depression, according to many economists.

The post Did You Know – Edition 7 appeared first on Capital CS Group.

Extended Deadline for 2019 Tax Filing and
Contributions

The federal deadline for filing your 2019 tax returns and making payments has been extended to July 15, 2020. Along with the tax-filing extension comes the ability to make later 2019 contributions to your traditional or Roth IRAs. If you have earned income and are able to make a contribution, you can make that contribution until the July 15 date.

Extended Deadline for Producing Forms 5498
and 5498-ESA

The IRS recently extended the deadline for producing 5498 and 5498-ESA forms for tax year 2019 to July 15. (The IRS may provide further time extensions on this date in the future, so this is subject to change.)

No RMDs for 2020

The law waives 2020 RMDs, because it is retroactive to January 1, 2020. In addition, if you were supposed to take a 2019 RMD by now but didn’t, you can avoid the penalty. The waiver also applies to beneficiary/inherited IRAs.

New IRS Guidance on Rollovers:

If you already took an RMD for 2020 and didn’t need to, you may be able to roll the money back into your IRA. According to the new IRS Notice 2020-23, as long as you took the distribution on or after February 1, 2020, you have an extension until July 15, 2020, to complete your 60-day rollover, provided you have not already completed a 60-day rollover in the past year. (The law still only permits one IRA-to-IRA rollover in a 12-month period.) This rollover extension does not apply to beneficiary/inherited IRAs.

We encourage you to speak with a tax professional to understand how this new regulation impacts your particular situation.

The post Did You Know – Edition 6 appeared first on Capital CS Group.

Report by Bruce Blythe

read full article at:
https://tickertape.tdameritrade.com/market-news/bear-
market-recession-investing-rebound-18045

What’s Different About the Most Recent Bear Market and Economic Slump? In a word or two: speed and volatility. The S&P 500 took only 22 calendar days to sink into bear market territory this year, compared to an average of 251 days for the other 12 post–World War II bear markets, according to Stovall. The 24/7, lightning-round nature of today’s markets combined with a global health crisis on a scale unlike anything in the modern era created a particularly volatile mix, Desai pointed out.“This is one of fastest and deepest market downturns and economic contractions we’ve ever experienced,” Desai explained. “The speed and magnitude of what we’re experiencing, coupled with loss of life, creates exponentially more stress, anxiety, and fear.”

What Are Common Mistakes Investors Make During Recessions and Bear Markets? The market’s recent behavior has been dramatic in terms of volatility and price swings, “but at the end of the day, fundamentals of stock investing are still the same,” Desai said. That makes it particularly important to try to keep emotions in check, maintain a disciplined investing strategy, and try to avoid these three common investor mistakes during market downturns.

Mistake 1: Selling at the bottom of a market.Nose-diving markets are often fueled by panic selling, which any investor with a long-term plan should avoid getting sucked into. Unload stocks during a slump, and you may just be locking in losses and eliminating any prospect of gains if prices recover. “It tends to be more prudent to ride out volatility and wait for the market to recover,” Desai said. “History shows the best opportunities to accumulate assets often come after the worst periods for markets.”

Mistake 2: Trying to time the market using economic data.Many economic readings are lagging indicators—snapshots of a previous month or quarter. Investors might consider macroeconomic data in the context of company or industry fundamentals, Desai said. “Looking at macro data by itself can potentially cause you to be late to react to what the market is doing,” he explained. “It might be better to focus on valuations and the prevailing market sentiment of asset classes as well.”

Mistake 3: Being too concentrated in certain assets and not diversifying.Too many eggs in one market sector basket can be a recipe for trouble, and bear markets can change the way some companies are valued. For example, before the 2008–09 financial crisis, many financial companies were considered blue-chip, high-dividend-paying stocks, Desai said. “But as these companies collapsed, their market value largely disappeared,” he said. “If you’re not diversified, markets can re-price certain stocks permanently.”

Bottom Line on Recessions and Bear MarketsOther steps for investors to consider during bear markets and otherwise turbulent times? Understand how dollar-cost averaging can help you scale in and out of positions, recognize and avoid “bear traps,” and know key differences between bear markets and bull markets. Plus, maybe consider one other thing: chill out and talk to an advisor or other market professional, someone who’s ridden out rough markets before and could help you navigate through uncertainty. Above all, don’t let emotions get the best of you.“In markets like we’ve had recently, it’s a good idea to check our emotional temperatures, turn down the noise, and separate what we know from what we don’t know,” Desai suggested. “Step back, focus on objectives, and consider diversification.”Diversification does not eliminate the risk of experiencing investment losses.

The post Did You Know – Edition 5 appeared first on Capital CS Group.

read the full article at:
https://tickertape.tdameritrade.com/market-news/weak-
bank-earnings-crude-lower-18059

written by JJ Kinahan, Chief Market Strategist, TD Ameritrade

(Wednesday Market Open) After rallying yesterday, the market seems to be in a more somber mood this morning as signs of the economic toll from the pandemic continue to mount. Oil prices pulled back amid worries about demand from a global economy that the International Monetary Fund said is heading to its worst recession since the Great Depression. That weighed on energy stocks even as the financial sector was under continued pressure from weaker-than-expected earnings as big banks set aside funds to deal with a wave of expected loan losses. In economic news, retail sales figures for March fell by a record 8.7%. Retail sales were expected to be dismal, with a Briefing.com consensus expectation

Key Take Aways

Retail sales dropped by a record 8.7%

Big banks stockpile funds for anticipated loan losses

Oil gets pressured from low demand expectations

forecasting a 10% decline. Despite all that, the selling this morning doesn’t
seem to be as intense as it has been in the recent past as Wall Street has been working its way higher in fits and starts as investors and traders try to feel out how solid the recent bounce is. And after all, there is bound to be some selling pressure in any market, but it’s an encouraging sign for bulls that that pressure seems to be moderating.

The post Did You Know – Edition 4 appeared first on Capital CS Group.

On Thursday the Federal Reserve took additional actions to provide up to $2.3 trillion in loans to support the economy. Funding will assist households and employers of all sizes and strengthen the ability of state and local governments to deliver critical services during the coronavirus pandemic.

The Federal Reserve’s actions will support employers of all sizes and communities across the country.

– Strengthen the effectiveness of the Small Business Administration’s Paycheck Protection Program (PPP) by supplying liquidity to participating financial institutions through term financing backed by PPP loans to small businesses. The PPP provides loans to small businesses so that they can maintain their workers on the payroll. The Paycheck Protection Program Liquidity Facility (PPPLF) will extend credit to eligible financial institutions that originate PPP loans, taking the loans as collateral at face value;

-Protect credit flows to small and mid-sized businesses with the purchase of up to $600 billion in loans through the Main Street Lending Program. The Department of the Treasury, using funding from the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) will provide $75 billion in equity to the facility;

-Increase the flow of credit to households and businesses through capital markets, by expanding the size and scope of the Primary and Secondary Market Corporate Credit Facilities (PMCCF and SMCCF) as well as the Term Asset-Backed Securities Loan Facility (TALF). These three programs will now support up to $850 billion in credit backed by $85 billion in credit protection provided by the Treasury; and

-Aid state and local governments manage cash flow stresses caused by the coronavirus pandemic by establishing a Municipal Liquidity Facility that will offer up to $500 billion in lending to states and municipalities. The Treasury will provide $35 billion of credit protection to the Federal Reserve for the Municipal Liquidity Facility using funds appropriated by the CARES Act.

For additional information visit: https://www.federalreserve.gov/newsevents/pressreleases/monetary20200409a.htm

The Capital CS Group remains in the office to guide you and your family through these
challenging times. For more information, contact our office at 844-390-2797.

The post Did You Know – Edition 3 appeared first on Capital CS Group.

article was written by
Matt Pate and is a work produced by the Nautilus Group

On March 27, 2020, the U.S. Congress passed, and the President signed into law, a massive and unprecedented economic rescue package to provide a capital infusion to individuals and businesses alike. This legislation follows on the heels of two recent bills aimed at providing emergency medical funding support as well as paid sick leave for many employees. As the saying goes, desperate times call for desperate measures, and the sudden and immediate shutdown of large swaths of the US (and global) economy as a result of the COVID-19 pandemic has resulted in a surge of unemployed workers as well as businesses facing existential concerns. The government mandated closures have triggered a needed government response that has been crafted to include direct cash payments to many, as well as government secured business loans that may be forgiven to the extent proceeds cover payroll costs and certain fixed business expenses. And to demonstrate the true thoroughness of the legislation, Congress saw fit to mercifully grant a temporary exception from excise taxes on alcohol to producers of hand sanitizer.

Key Stimulus Provisions of the
CARES Act

Expedited Small Business Administration (SBA) loans, for businesses with fewer than 500 employees, up to $10 million with loan principal forgivable up to the total cost of eight weeks’
worth of payroll, rent, mortgage interest and utilities of the business

Payments of $1,200 per individual ($2,400 for married couples), plus $500 per child, for individuals with income below certain thresholds ($75,000 single/$150,000 married);

Penalty-free access of up to $100,000 from IRAs and qualified retirement plans for participants impacted by the coronavirus, plus
increased loan capacity to such level;

Waiver of required minimum distributions from IRAs and qualified plans for 2020;

Deferral for payment of the employer portion of the FICA taxes payable in 2020;

The ability to carry net operating losses incurred in 2018-2020 back to prior tax years in order to generate potential tax refunds this year and next; and

Various other short-term tax rules changes, including additional incentives for charitable gifts

The post Did You Know – Edition 2 appeared first on Capital CS Group.

Coronavirus Related Distributions

The law waives the 10% tax penalty on
withdrawals up to $100,000 from a retirement
plan for an individual who: Is diagnosed with COVID-19;

• Is diagnosed with COVID-19;
• Whose spouse or dependent is diagnosed
  with COVID-19;
• Experiences adverse financial consequences as a result of:
  • Being quarantined, furloughed, laid off, having hours reduced
  • Being unable to work due to lack of child care due to COVID-19,
  • Closing or reducing hours of a business owned or operated by an individual due to COVID-19.

Individuals will have the option to pay tax on the income from the distribution over a 3-year period, or repay that amount back to the plan – tax-free – over a 3-year period. Repayments are not subject to contribution limits.

Additional provisions

Plan Loans The law increases the amount a participant may borrow from his or her retirement account to the lesser of $100,000 or 100% of the participant’s vested balance. The Act also allows participants with outstanding loans to delay any loan payments due during the balance of 2020, for up to one year. To qualify, a participant must meet the same criteria as outlined under Coronavirus Related Distributions, above.

Required Minimum Distributions The law includes a temporary suspension of the required minimum distributions (RMDs) for 2020.

The Capital CS Group remains in the office to guide you and your family through these challenging times. For more information, you can contact our office at 844-390-2797.

The post Did You Know – Edition 1 appeared first on Capital CS Group.