A Viral Market Update XIII: The Strong (FANGAM) Get Stronger!

In this one, I plan to focus on a subset of these companies, the FANG (Facebook, Inc. (NASDAQ: FB), Apple Inc. (NASDAQ: AAPL), Netflix Inc (NASDAQ: NFLX) and Google Alphabet Inc (NASDAQ: GOOGL) stocks, younger companies that have soared in value over the last decade, and two other tech companies of longer standing, Apple and Microsoft Corporation (NASDAQ: MSFT). These FANGAM stocks, which have dominated the market for the last decade, have become even more dominant during the crisis, and explaining (or trying to explain) that phenomenon is key to understanding both the market comeback and to assessing whether it is sustainable.

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Market Outlook

My crisis clock started on February 14, 2020, and it is now six months since its start, and as with my previous updates, I will begin with a quick overview of financial market action over this period. I start by looking at selected equity indices, spread geographically, and how they have performed over the period:

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On August 14, the S&P 500 was almost back to where it was on February 14, which was an all-time high, and the NASDAQ was 13.46% higher than its February-levels, hitting new highs. In local currency terms, the Latin American indices were still showing double-digit declines, as of August 14, but the Asian indices have recouped much of their early losses. As equities have gone on a roller-coaster ride, US treasuries have settled into a holding pattern, with rates across maturities at much lower levels than prior to it:

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