|
|
By Nicholas
Jasinski | Thursday, October 29 Mean
Reversion. A lackluster morning
gave way to an afternoon rally today. Stocks closed with solid gains,
following four days of losses and the major indexes’ worst drop in
months yesterday. Coronavirus and election worries took a back seat for
a day, as the latest economic data and a flood of earnings reports held
investors' attention. The S&P
500 rose
1.2%, the Dow Jones Industrial
Average closed up 0.5%, and the Nasdaq
Composite gained 1.6%. Nine of the S&P 500's 11
sectors and 433 of its components ended the day in the green. Released
this morning, the Bureau of
Economic Analysis' advance estimate of
third-quarter U.S. real gross
domestic product came in slightly
higher than economists had expected. GDP increased at a massive 33.1% annual
rate in the third quarter, which follows a record contraction of 31.4% in the
second quarter. Also this
morning, initial claims for unemployment benefits—a more-current
economic indicator—dipped to 751,000 in the latest week. That’s high compared
with pre-pandemic levels, but continues
a recent improving trend. Today was
one of the busiest days of third-quarter earnings season, with 68 S&P 500
companies releasing their financial results. You can find all of Barron's earnings coverage here. On the
pandemic front, the news continued to be concerning. The U.S. set a record
for the seven-day average of new Covid-19 cases, at about 72,000, and the
rate of case growth was increasing in 41 states. Some state and local
governments—including in Texas, Massachusetts, Colorado, and Idaho—required
closures of schools or certain businesses in response to outbreaks. No area in
the U.S. has returned to the widespread shutdowns of the pandemic’s early
months, but some economists warned that consumers and workers concerned about
being infected could be curtailing their activity on their own. Europe is
another story, with higher per-capita infection rates across much of the
Continent than in the U.S. Germany and France separately introduced new
one-month restrictions to counter a wave of coronavirus cases, and there was
discussion of similar measures in the U.K. “The worry
from a U.S. standpoint is that there will be a repeat for the sequencing from
the first wave -- first, Europe sees rising cases and locks down and
the U.S. follows,” said Jasper
Lawler, head of research at London
Capital Group. “This is especially true
after a Biden election victory.” The U.S.
election is now just five days away. Former Vice President Joe Biden remains
the presidential favorite, but control of the Senate appears to be up for
grabs. Markets hate uncertainty, but perhaps at least on that question, the
end could be in sight. |
|
|
DJIA: +0.52% to 26,659.11 The Hot
Stock: CBRE Group +16.8% Best Sector:
Energy +3.1% |
No comments:
Post a Comment