Wall Street slumps on rising virus cases, fading stimulus hopes

Andrew Cummings
October 27, 2020

The S&P 500 banks index and the S&P energy sector shed about 1% each.

In point of fact, Monday's tottering in the Wall St. was nearly entirely prodded by market participants' worries over a second round of pandemic-led business closure, which in effect would simmer the prospects of an economic recovery, while waning hopes of a U.S. relief bill before the November 3 election day had added to further woes.

A surge in new Covid-19 cases was still very much so at the forefront of investors' minds as stocks tried to bounce back from the previous session's heavy losses that came after the USA reported a record average of 68,767 cases per day over the last week.

At 10:53 a.m. ET, the Dow Jones Industrial Average fell 78.40 points, or 0.28% to 27,606.98, the S&P 500 lost 1.09 points, or 0.03% to 3,399.88 and the Nasdaq Composite gained 63.73 points, or 0.56% to 11,422.67.

On Tuesday, oil prices steadied, with USA benchmark crude gaining 19 cents to $38.75 per barrel in electronic trading on the New York Mercantile Exchange.

The S&P 500 is up 170.19 points, or 5.3%.

Stocks ended sharply lower on Wall Street today, deepening last week's losses.

Norwegian Cruise Line Holdings fell 8.4 percent, Marathon Oil dropped 7 percent and United Airlines lost 7 percent.

US House Speaker Nancy Pelosi on Sunday said the Trump administration was reviewing the latest proposal for COVID-19 relief over the weekend and that she expected a response on Monday.

Among the market's few gainers were companies that can succeed even in a stay-at-home economy. "Most of the recent economic data has been strong, but when you see parts of Europe going back to rolling shutdowns, it reminds us this fight is still far from over". They and other Big Tech stocks have soared through the pandemic on hopes their growth will only continue as work-from-home and other trends that benefit them accelerate. Besides Amazon and Apple, Ford Motor, General Electric and Google's parent company, Alphabet, are also on the docket. Merck, Invesco and Laboratory Corp. of America were among the roughly two dozen companies in the S&P 500 on Tuesday morning that reported earnings for the summer above analysts' expectations. If that level holds, it would be the best since at least 2008, when FactSet's records began.

Meanwhile, the upcoming US elections could mean more short-term uncertainty in the markets and the results could determine the size and timing of any aid from Congress, said Esty Dwek, head of global market strategy at Natixis Investment Managers.

European and Asian markets closed lower.

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