"With the economy getting crushed, some analysts are wondering how equities could have bounced so hard from the March lows. We understand their confusion. With unemployment likely above 15% and real GDP falling roughly 30% in Q2, how can equities be doing so well?
One key to understanding this is that investors don't buy shares of GDP, they buy ownership stakes in a distinct set of companies, many of which are doing quite well despite the general economic carnage.
... In many ways, the spread of the Coronavirus has given larger well-capitalized companies, particularly technology companies and big box stores that were allowed to stay open, an advantage over Main Street competitors. And unlike Main Street businesses, a larger share of these companies are publicly traded."
(S&P 3100, Dow 25750 dated 05/11/2020 by Brian S. Wesbury, Chief Economist, Robert Stein, Deputy Chief Economist, with First Trust.
Full article can be read here: https://www.ftportfolios.com/Commentary/EconomicResearch/2020/5/11/sp-3100,-dow-25750