Market Update: Wed, Nov 18, 2020 | LPL Financial Research

Daily Insights

US Markets open higher. Investors are taking advantage of marked-down equity names, reversing course from Tuesday. On Tuesday market participants were focused on COVID-19 case spikes and potential effects on the economic recovery. Gridlock on fiscal stimulus added to worries.

  • Utilities was Tuesday’s worst performer; energy held up the best.
  • Asian markets finished mostly higher; the Japanese Nikkei finished lower by more than 1%.
  • European markets are mostly higher through midday trading.
  • The Boeing 737 MAX was cleared to fly after being grounded for 20 months.

5 top charts. From one of the best Novembers for stocks to total retail sales at new highs and extremely strong market breadth, we highlight five key charts in the LPL Research blog.

Technical update. Stocks fell slightly Tuesday. The Russell 2000 Index bucked the trend, however, and ended the day with a 0.4% gain. The Russell 2000 has now outperformed the S&P 500 Index by more than 10% in just the fourth quarter alone. The ratio between the two has surged to more than 7% above its 200-day moving average, a positive sign for the technicals of small versus large.

COVID-19 news. New US case growth has slowed some this week, with Tuesday’s total up 19% week over week, the slowest in 15 days. The 29% increase in the seven-day average was the smallest increase in 10 days (source: COVID Tracking Project).

  • Hospitalizations fell week over week for the first time since November 2.
  • Los Angeles County will impose new restrictions and warned it may bring back stay-at-home orders.
  • Pfizer’s vaccine was 95% effective in final analysis of its phase 3 trial data, and emergency use authorization may be coming within days



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