AT&T Breaks A 10-Day Streak

By Nicholas Jasinski |  Thursday, October 22 Directionless. U.S. stocks initially continued to struggle for direction today, bouncing around the break-even line for most of the morning. Several uncertainties loom large over the market, including the presidential and congressional elections, the implications of  Covid-19 cases rising again in the U.S. and Europe, and the latest from fiscal stimulus negotiations in Washington. In recent weeks, stock indexes have bounced around from day to day driven by incremental news and headlines on all of those fronts, but haven't had a prevailing direction since the late summer. The S&P 500 is even with its levels near the end of August. Individual trading sessions have shown plenty of volatility during that time, and market pricing suggests they'll continue to be. The Cboe Volatility Index, or VIX, has been hovering just below 30 for most of the past month. Different days recently have also had different groups of winners. Today saw value-oriented stocks take the lead in the afternoon, pushing major indexes solidly into the green. The Dow Jones Industrial Average closed up 0.5%, after dipping between positive and negative territory for most of the morning. The S&P 500 rose 0.5% and the Nasdaq Composite added less than 0.2% on a poor day for technology shares. The S&P 500 technology sector closed down 0.4%, the second-worst in the index. PayPal Holdings dropped 4.3%, Adobe lost 2.5%, Salesforce.com fell 1.8%, and Apple slipped 1%. Growth areas of the market more generally underperformed today, with consumer discretionary another laggard. Beaten-up energy shares, on the other hand, led the market with a 4.1% rise. Exxon Mobil and Chevron added 3.7% and 2.4%, respectively. Financials—and banks in particular, another unloved group—were also big gainers, closed up 2%. JPMorgan Chase stock gained 3.5%, Bank of America added 3.4%, and Morgan Stanley rose 2.8%. There wasn't much of a catalyst for the value rally, perhaps other than the fact that growth areas of the market did better yesterday. Perhaps tomorrow will be their day again. Just don't expect a steady and consistent direction for the market until some near-term uncertainties have been resolved one way or the other.

 

DJIA: +0.54% to 28,363.66 S&P 500: +0.52% to 3,453.49 Nasdaq: +0.19% to 11,506.01 The Hot Stock: Align Technology +35% The Biggest Loser: Cincinnati Financial -9% Best Sector: Energy +4.1% Worst Sector: Real Estate -0.7%