Sign up for our daily briefing
Make your busy days simpler with Axios AM/PM. Catch up on what's new and why it matters in just 5 minutes.
Stay on top of the latest market trends
Subscribe to Axios Markets for the latest market trends and economic insights. Sign up for free.
Sports news worthy of your time
Binge on the stats and stories that drive the sports world with Axios Sports. Sign up for free.
Tech news worthy of your time
Get our smart take on technology from the Valley and D.C. with Axios Login. Sign up for free.
Get the inside stories
Get an insider's guide to the new White House with Axios Sneak Peek. Sign up for free.
Catch up on coronavirus stories and special reports, curated by Mike Allen everyday
Catch up on coronavirus stories and special reports, curated by Mike Allen everyday
Want a daily digest of the top Denver news?
Get a daily digest of the most important stories affecting your hometown with Axios Denver
Want a daily digest of the top Des Moines news?
Get a daily digest of the most important stories affecting your hometown with Axios Des Moines
Want a daily digest of the top Twin Cities news?
Get a daily digest of the most important stories affecting your hometown with Axios Twin Cities
Want a daily digest of the top Tampa Bay news?
Get a daily digest of the most important stories affecting your hometown with Axios Tampa Bay
Want a daily digest of the top Charlotte news?
Get a daily digest of the most important stories affecting your hometown with Axios Charlotte
Illustration: Aïda Amer/Axios
Little has changed about the fundamentals since last week's selloff that was the worst in months, but bullish stock traders have bid back all of the the S&P 500's losses and sent the Nasdaq to a new record high.
What's happening: The market continues to bet on generous central banks providing stimulus to help the global economy recover from the novel coronavirus outbreak that has stalled supply chains, closed businesses and quarantined millions of people.
- The People's Bank of China has obliged already, cutting banks’ reserve requirement ratios and pumping hundreds of billions of dollars into markets to help stabilize the Shanghai and Shenzhen stock exchanges, which fell to their lowest levels in a year on Monday.
More is expected from China in the coming days. The PBOC is seen lowering its key lending rate and continuing to pump cash into the banking system.
On the other side: Most commodity prices have seen no such rebound thus far, with oil falling by 20% from its last high and now in a bear market. Metals like nickel, aluminum and lead also have continued to fall.
- Copper prices, seen as a proxy for expected global growth, rose by 1% on Tuesday, but are down 8.5% year to date.
Why it matters: There are not yet signs global growth will recover from the coronavirus shock, yet the Dow is trading at a price-to-earnings ratio of nearly 20 and the Nasdaq's P/E ratio is over 29, according to FactSet data.
- Both figures are well above historical averages and even higher than earlier this year when top investment strategists warned that valuations had gotten especially high and looked poised for a pullback.
- Stocks will likely need strong economic growth to live up to their current valuations.
Go deeper: Why the stock market keeps rising despite coronavirus fears