Wall Street starts in the red two sessions away of the presidential election

Wall Street démarre dans le rouge à deux séances de l’élection présidentielle
November 2, 2020
Wall Street on course for sharp gains as election hangs in balance
November 4, 2020

Wall Street starts in the red two sessions away of the presidential election

Wall Street started in the red on Friday for its penultimate session before the US presidential election, concerned about the second wave of the Covid-19 epidemic in Europe and the United States and about an electoral result that could be long overdue .

At 1:45 p.m. GMT, its flagship index, the Dow Jones Industrial Average, lost 0.55% to 26,512.08 points. The Nasdaq, with strong technological coloring, dropped 1.36% to 11,033.21 points. The extended S&P 500 index fell 0.53% to 3,292.71 points.

The day before, the indices had rebounded anticipating good results from the technology sector, after the dark day on Wednesday.

The Dow Jones Industrial Average, had ended up 0.52%. The technology-heavy Nasdaq rebounded 1.64% and the broader S&P 500 index advanced 1.19%.

But on Friday the nervousness took over.

“It is the permanent concern, between the outbreak of coronavirus cases and the elections in four days. This is what fundamentally scares the markets, ”said Peter Cardillo of Spartan Capital Securities.

“The question for the markets is not to know who will win but when we will know the result”, he continued, while noting the possible “social unrest” hovering over the post-election evening.

According to polls, Democratic candidate Joe Biden has a slight lead over White House tenant Donald Trump (51% versus 47%, according to an NBC survey Thursday).

Despite rebounding US growth in the third quarter released Thursday, despite results from big names in tech deemed rather good, investors focused their attention on negative aspects such as uncertain forecasts disclosed by companies.

Thus, despite a surge in sales in the third quarter thanks to the pandemic, the e-commerce giant Amazon lost 3.55% shortly after opening.

Its year-end sales forecast disappointed analysts. The group, which employs more than 800,000 people worldwide, also announced that it expected the epidemic to cost it $ 4 billion after already 2.5 billion in the previous quarter.

Twitter was being punished by Wall Street for slowing user growth despite rising ad revenue. The stock fell 16.64%.

Alphabet, the parent company of Google, however, remained convincing (+ 5.68%) after a quarterly profit of 11.2 billion dollars for a turnover of 46.2 billion.

“We are heading towards a negative week and month of October on Wall Street,” according to Peter Cardillo. “We will certainly end the month with losses,” assured the chief economist.

The stock of US oil giant ExxonMobil was down slightly (-0.14%) after posting a deficit for the third quarter in a row on Friday due to crude demand undermined by the effects of the pandemic on the economy.

Among the positive news, the income and expenditure of American households increased more than expected in September, despite the absence of a new economic support plan deemed necessary to revive growth. Income rose 0.9% and expenses 1.4%.