Click here for Logical Analysis ReportOp-ed:
From our analysis, we found the following most relevant:Especially when mistrust of news media is high, they tend to rely on how people they know respond to news. This process of evaluation takes time, which is why stock markets do not respond to news suddenly and completely, as conventional theory would suggest. The news starts a new trend in markets, but it is sufficiently ambiguous that most smart money has difficulty profiting from it.
Of course, it is hard to know what drives the stock market, but we can at least conjecture ex post, based on available information.1
There are three separate phases of the puzzle in the US: the 3% rise in the S&P 500 from the beginning of the coronavirus crisis, on January 30, to February 19; the 34% drop from that date until March 23; and the 42% upswing from March 23 to the presentAt a time when genuine news suggests that equity prices should be tanking, not hitting record highs, explanations based on crowd psychology, the virality of ideas, and the dynamics of narrative epidemics can shed some light.
NEW HAVEN - The performance of stock markets, especially in the United States, during the coronavirus pandemic seems to defy logic.