The Stock Market News

The Stock Market isn’t reflecting the reality yet, but Citigroup warns that pain and ‘Collateral Damage’ are on the way.

That’s Manolo Falco, Citigroup’s US: C co-head of investment banking, explaining to the Financial Times why he believes the firm’s corporate clients should raise as much cash as possible before the reality of the pandemic sinks in for investors.

“As the second quarter comes along and we start seeing the pain, and the collateral effects of that,” Falco continued, “we think this is going to be much tougher than it looks.”

To his point, last month wasn’t so tough, in terms of market performance. The Dow Jones Industrial Average US:DJIA, S&P 500 US:SPX , and tech-heavy Nasdaq Composite US:COMP all closed the books on a strong May on Friday, buoyed by mounting optimism over the easing of lockdowns in the U.S. along with a supportive Federal Reserve.

This while global economies continue to grapple with historic recessions.

“Markets are pricing a V [shaped recovery], everyone’s coming back to work, and this is going to be fine,” Falco told the FT. “I don’t think it’s going to be that easy quite frankly.”