Stocks down after strong December open. Equity markets opened lower today after Tuesday’s strong session where the S&P 500 Index and NASDAQ finished 1% higher. Market participants appear concerned about higher COVID-19 numbers amid vaccine progress. There’s still no clear path to a bipartisan deal on additional COVID-19 fiscal stimulus measures.
- Communication services and tech names led the market Tuesday.
- Energy, which was dominant in November, trailed with lower WTI crude prices Tuesday.
- Asian markets closed their trading day mixed.
- European markets are mostly lower during midday trading.
December’s A Strong Month for Stocks
Since 1950, the S&P 500 has been up 1.5% on average in December, the second best month of the year. Stocks have been up 2% on average when the year-to-date return was 10% or more heading into December. Election-year Decembers also have been strong—could December deliver more gains in 2020? Read today’s LPL Research blog.
Technical update. Stocks set more record highs Tuesday as the communications services sector led the S&P 500 to a 1.1% gain. Along with communications services, technology helped propel the NASDAQ 100 to its first record high since September 2. The S&P 500 now has strong technical support in the range from 3550–3600.
COVID-19 news. New cases in the United States rose 6% week over week on Tuesday, the first weekly increase in four days. The seven-day average is about 6% below the prior week, but holiday gatherings may increase these numbers (source: COVID Tracking Project).
- Hospitalizations rose 15% week-over-week and are up more than 70% over the past month based on seven-day averages.
- Pfizer and BioNTech received approval for their COVID-19 vaccine in the United Kingdom, where it is expected to be available beginning next week.
- The US Food and Drug Administration will discuss the Pfizer-BioNTech vaccine on December 10.
- Healthcare workers and residents of long-term care centers will be prioritized, according to the US Centers for Disease Control.
LPL Research in the Media
Chief Market Strategist Ryan Detrick appeared on Fox Business recently. Watch Ryan’s interview here.
Equity Strategist Jeff Buchbinder was quoted in Kiplinger discussing the stock market. Read Jeff’s quote here.
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