U.S. stock indexes rebounded from early losses on Friday but traded mostly lower as investors reacted to a weaker-than-expected September jobs report and news that U.S. President Donald Trump and first lady Melania Trump had tested positive for the coronavirus.

The president and his wife will need to be quarantined as the presidential election campaign enters its final weeks. The diagnosis overshadowed congressional negotiations for a new round of fiscal stimulus to combat the impact of the epidemic on the economy.

How are the stock indices faring?

The Dow Jones Industrial Average (DJIA)
The Dow Jones
,-0.24%
.


Flashing around flat at midday, volume was last seen trading about 4 points lower to 27,812, while the S&P 500
SPX
, -0.70%


traded about 17 points, or 0.5 percent, to about 3,364. The Nasdaq Composite Index
COMP
,-1.87%
.


Down 195 points, or 1.7%, to 11,131.

For the week, as of Thursday’s close, the Dow was up 2.4 percent for the week, the S&P 500 was on track for a 2.5 percent gain, while the Nasdaq was on track for a 3.98 percent weekly gain.

What’s driving the market?

A disappointing September jobs report and Trump’s positive COVID-19 test helped dampen bullish sentiment on Wall Street, with a lack of progress on new fiscal stimulus to help the economy recover faster from the epidemic.

The U.S. economy created 661,000 new jobs in September and the unemployment rate fell again to 7.9 percent, the lowest level since the pandemic, but the increase in hiring was the smallest since the economy reopened and indicated a deceleration in the recovery. The drop in the unemployment rate largely reflects the 700,000 people who dropped out of the labor market as new jobs became scarce. Since the economy shut down in mid-March, about 12 million jobs have been taken back and about 22 million people have been laid off.

“Job growth is slowing just as financial aid is about to expire – a toxic cocktail,” wrote Oxford economist Kathy Bostjancic in a note.” Despite relatively strong growth since May, employment is still a staggering 10.7 million below Covidien’s previous level,” she added.

But the jobs report was overshadowed by the president’s diagnosis tweeted earlier Friday.

Although the White House doctor said the two “good condition”, will continue to be in isolation, but recent reports show that Trump has “mild symptoms”.

“Everyone was expecting a surprise in October. Still, to be honest, this one flew in from the left and not only left almost everyone flat-footed, but it may have hit at the most vulnerable time of the week as the risk is off due to the fiscal impasse,” wrote Stephen Innes, an independent market strategist.

Some investors believe Trump could hurt his campaign efforts as the race for the White House with challenger former Vice President Joe Biden heats up heading into the Nov. 3 election, where he was forced to quarantine himself while dealing with a deadly disease.

“What’s to say? Yes, it’s definitely a development that will affect people’s mindset for weeks to come,” said John Carey, director of U.S. equity earnings at Amundi Pioneer, in an interview. On the other hand, Carey noted, “Speaker Pelosi has indicated that perhaps the dynamics of the stimulus discussion have changed and that it’s more likely to be a compromise measure after all.”

Particularly in light of the weak jobs report, Carey said, “Maybe this will serve as a reminder that this is a very serious crisis and the government needs help. If we didn’t have an aggressive CARES Act and so much Fed stimulus, we’d be in worse economic shape.”

Carey noted that questions about the economy seem to be increasingly driving market trends.” With low levels of economic activity, there still seems to be a lot of questions about energy, as well as about people-focused businesses like retail and hospitality. Manufacturing is an area I would watch, and there are mixed signals of strength there.”

Trump’s response to the coronavirus pandemic has been sharply criticized, though he has often praised his management of the health crisis. To date, the United States has recorded more than 7.27 million cases of coronavirus and 20,788 related deaths, according to data compiled by Johns Hopkins University. Trump, 74, who tested positive for the coronavirus, follows British Prime Minister Boris Johnson, 56, and Brazilian President Jair Bolsonaro, 65.

The diagnosis forced investors to reassess the likelihood of a Biden victory and its impact on the markets, as Trump is widely seen as a business-friendly president while the former vice president is seen as more likely to raise taxes and increase regulations.

On Friday afternoon, Biden tweeted that he and his wife, Jill, had tested negative.

Which stocks are getting attention?
  • Shares in avocado producer Mission Produce
    AVO
    ,-8.95%
    .


    It came under scrutiny Friday after trading began Thursday. The stock was down 9.4%.

  • Tesla’s stock
    TSLA
    ,-5.98%
    .


    The company was in the spotlight after it released its auto sales results, showing that the electric mark sold about 124,100 Model 3s and Ys. the company’s shares fell 6%.

  • Walmart.
    WMT
    ,-1.
    50%

    .


    Shares fell 1.4% after the retailer announced a deal to sell its U.K. supermarket chain Asda last Friday, finally getting rid of a division the U.S. giant has long wanted to sell.

  • Uber Technologies
    UBER
    , -0.63%


    said it received $500 million from Greenbriar for Uber Freight. shares were down 0.6% in early afternoon trading.

How did the rest of the market trade?

The yield on the 10-year Treas.
TMUBMUSD10Y
, 0.694%
.


Up 2 basis points at 0.696%, it was initially sold off on the news of the diagnosis. Bond prices are moving in the opposite direction to yields.

The price of benchmark U.S. crude oil futures for November delivery.
CL.1
, -4.39%
.

CLX20
,-4.39%
.


fell 3 percent to trade at $37.30 a barrel on the New York Mercantile Exchange on fears of a rise in the number of cases.Gold futures for delivery in December
GCZ20
,-0.58%
.


Down 0.4% to $1,908.00 an ounce, investors parsed the morning news, up 1.1% on Thursday.

In global equities, the Stoxx Europe 600 Index
SXXP
,+0.24%
.

closed up 0.3% at 362.69, while the FTSE 100 Index
UKX
,+0.38%
.


It rose 0.4 percent to close at 5,902.12.

A measure of the strength of the dollar against a basket of currency trading partners.

ICE dollar index
DXY
,+0.13%
.

.

It was up about 01.%, a little weaker than earlier in the day.

<br=””>
source link

</br=””>

2020-10-02