Alex Pettee, CFA
Weekly Outlook: REITs Rebound As Earnings Heat Up
Despite another week of downright ugly economic data, U.S. equity markets delivered their best month since 1987 in April amid rising optimism of an impending economic reopening.
The economic reopening could not come soon enough. Another 3.8 million Americans filed for unemployment claims this week, bringing the six-week total above 30 million.
Ending April with gains of 13%, the S&P 500 ended this week lower by 0.1%, but mid-cap and small-cap stocks bucked the prevailing trends of 2020 by delivering strong gains.
Equity and Mortgage REITs each outperformed this week as earnings results have generally been in line or slightly better than expectations. Rent collection has largely been a non-issue for non-retail REITs.
Earnings season hits high-gear next week with 50% of the REIT sector reporting results. 28 out of 165 Equity REITs have cut dividends since the start of the pandemic.