Stocks sell off amid Thursday’s rally
The market shrugged off COVID-19 new case numbers and ended Thursday higher. This followed Wednesday’s decline in which the S&P 500 Index pulled back the most since June of this year.
- US stocks are reversing course from Thursday’s close amid mixed investor takeaways from big tech earning reports.
- European markets are lower through midday trading. Rising COVID-19 numbers and their effect on the economic recovery are concerns.
- Asian markets closed lower, with the Hang Seng and Shanghai markets down over 1.5%.
Euro-area economy snaps back
Europe saw a stronger growth surge than the United States in the third quarter, with gross domestic product (GDP) spiking 12.7% (not annualized) quarter over quarter, but falling 4.3% year over year. That pace was well ahead of Bloomberg’s consensus forecast at 9.6%. Recapturing so much lost economic output in a short period as Europe’s economies opened is welcomed, but the risk of fourth quarter contraction in the Eurozone has risen with renewed COVID-19 restrictions.
One more presidential election pattern
In 15 of the last 17 elections, the party in power has been given a second term. But after a second term, the American electorate has sought balance and flipped the White House. We explain what this pattern may mean for the current election.
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Market Signals podcast moved to Nov. 5
Monday’s Market Signals podcast has been moved to Wednesday, Nov. 4, to provide real-time market and economic analysis the day after the election. Look for next week’s Market Signals podcast and video the afternoon of Nov. 5.
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Stocks attempted to rebound on Thursday, but despite a 1.2% gain for the S&P 500, breadth was disappointing as advancers outnumbered decliners on the New York Stock Exchange by just over 2:1. Heavily weighted Apple is dragging markets lower in early trading. The S&P 500 has support at 3209, about 3% below Thursday’s close, while the NASDAQ has similar support at the 10,500 level.
With four days to go until Election Day, 60% of the total votes cast in 2016 have already been submitted, with 10 states clearing the 80% market, according to the US Election Project. Overall, 82 million Americans have already cast their ballots, or roughly half of the registered voting population. Safety concerns and worries of long lines on Election Day remain on the minds of voters.
New COVID-19 cases in the United States jumped 21% week over week on Thursday, to a new record high of more than 88,000, while the seven-day average increased 25% to over 76,000, the sixth straight day with a more-than 20% increase (source: COVID Tracking Project). Hospitalizations continue to rise steadily—the seven-day average is up 46% in October. The United Kingdom began accelerated reviews of vaccines from Pfizer and AstraZeneca.
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