US markets rallying on positive vaccine buzz. The S&P 500 Index is set to add to Tuesday’s solid gains after positive early-phase trial results for Moderna’s COVID-19 vaccine took some of the sting out of the recent surge in cases. Pending initial vaccine trial results from Oxford University, the continued rollout of earnings season, and anticipation of more stimulus also may be supporting market sentiment. Most Asian markets saw more modest gains overnight, although China’s Shanghai Composite was down more than 1%. Major European indexes are higher in midday trading.
Fear a Democratic sweep? Polls show a growing possibility of a Democratic sweep of the White House and Congress in November. This may lead to a higher corporate tax rate and a cut to earnings. Many are worried about the potential impact this could have on stocks, but it’s important to note the S&P 500 has gained 9 of the past 10 years under this scenario, so maybe it isn’t the worry it is made out to be. We discuss this in more detail later today on the LPL Research blog .
Checking on high frequency data. We look at the continued increase in US COVID-19 cases and its impact on the real-time data points we’re monitoring to gauge the pace of the US economic recovery later today on the LPL Research blog.
Midyear Outlook 2020 is here. LPL Research’s Midyear Outlook 2020: The Trail to Recovery reviews where we’ve been in 2020, where we may be heading, and the path that will take us there. Our special elections section explains how stocks and the economy may predict the next president. Find supporting marketing material on the Resource Center, including a PDF, printer-friendly version, client letters, Social Sharing Guide, and Executive Summary. Printed brochures can be ordered now in Marketing On Demand to ship August 1.
COVID-19 news. Johns Hopkins reported 67,500 new cases in the United States on Tuesday, up 12.3% week over week on a 10% drop in testing and with a positive test rate of just over 8%. Daily new hospitalizations have steadied well below April’s peak, but have averaged more than 1,000 per day over the past seven days. Moderna’s vaccine produced antibodies in all patients tested in an early trial, though some patients reported side effects. Results from an early stage trial of Oxford University’s COVID-19 vaccine candidate are reportedly coming this week. Tokyo raised its virus alert to the highest level.
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