By Alfred Lam, CFA, Senior Vice-President and Chief Investment Officer and Marchello Holditch, CFA, Vice-President and Portfolio Manager CI Multi-Asset Management
Much like the soothsayer in William Shakespeare’s Julius Caesar, governments warned individuals in the middle of March to stay home. Social distancing measures have undoubtably reduced the spread of COVID-19 and saved lives, but have also had a significant impact on economic activity. Manufacturing output, employment figures and retail sales are experiencing their sharpest contraction since at least the Second World War. As social distancing measures only became more widespread in the second half of March, activity is likely to fall even more sharply in April. Nevertheless, signs that the infection rate is declining and rapid policy responses have helped drive a partial rebound in stock markets.