Stocks finished higher on Wednesday, but that’s not all.
It was the end of the month AND the quarter. Phew.
September wasn’t rosy for the market. The Dow, the S&P 500 and the Nasdaq Composite all recorded losses, breaking a five-month winning streak and making it the first down-month since March!
For the quarter overall, things were a bit better: All three indexes ended higher, making it the second straight quarter that stocks rose following the abysmal first three months of the year.
Wednesday’s trading higher was likely influenced by the session being the last of September. But also boosting optimism was better-than-expected economic data and hopes that another push on stimulus negotiations might lead to a deal.
The Dow closed up 1.2%, or 329 points, while the S&P finished 0.8% higher. The Nasdaq closed up 0.7%.
The pandemic recession isn’t like any we’ve ever seen before. This is a big-city recession, according to Indeed chief economist Jed Kolko.
Why are cities suffering so much more?
“Because these places have seen bigger job losses, [as] some hard-hit sectors are concentrated in big cities,” such as hospitality, Kolko told Alison Kosik on CNN Business’ digital live show Markets Now.
And making matters worse, “in the cities where more people can work from home, local businesses suffer,” he added.
According to Indeed, job postings are still down about 18% compared to last year, but even just being down one-fifth in job postings would represent a big hit to the economy, Kolko said.
“There are a handful of sectors where job postings are at or above what they were last year,” he added. “These tend to be sectors that support the stay-at-home economy,” he said, such as construction, some retail jobs and warehouses.
Meanwhile, hospitality and tourism jobs are still down by about half.
“The economy can’t fully recover until people feel completely comfortable traveling, seeing each other in person,” Kolko said.
Many Americans are still working remotely as the Covid-19 pandemic drags on. But this doesn’t mean that men don’t shave anymore. Frequent video calls require folks to still look their best, and that’s helping the likes of personal care business Harry’s.
“Overall we’re up. The trends we’re seeing as a direct-to-consumer business have been growing,” Harry’s CEO Jeff Raider told Alison Kosik on the CNN Business digital live show Markets Now.
Raider said the company, which sells razors and other grooming items, is building to grow its existing brands and launch additional products. But he didn’t want to commit to any IPO plans on the show.
Earlier this year, the FTC blocked a merger of Harry’s and Schick parent Edgewell Personal Care.
The election is approaching fast, with the presidential debates kicking off with a bang last night – and investors are looking for clues about how to get through the end of the year.
Samantha Azzarello, global market strategist at JPMorgan Asset Management, suggested investors should focus on policy, not politics. Looking at it that way, she noted, there are actually some similarities between the candidates.
“We would say right now the Democrats and the Republicans are both hawkish on China,” Azzarello said on the CNN Business digital live show Markets Now. “Also, there’s some agreement on infrastructure spending.”
The points of disagreement are tax, regulation and energy policy, she added.
The market isn’t pricing in a blue wave as much any more as it has before, Azzarello said. A lot will come down to the House and Senate races as well, because that will decide how the next administration can execute its policies.
“If there’s a contested election it will not be good for markets because there will be uncertainty,” she added.
Well that got snarky…
Former Goldman Sachs (GS) CEO Lloyd Blankfein clearly doesn’t think there’s much to President Donald Trump’s claim that the stock market will sell off if former Vice President Joe Biden wins the election in November.
Stocks’ long-term performance is historically better under Democratic administrations.
On top of that, Wall Street appears staunchly in the Biden camp, hoping that a steadier path ahead can offset higher taxes and increased regulation.
Friday’s jobs report will be the main data point of the week for the labor situation, but before that we’ll get jobless claims data from the Labor Department tomorrow at 8:30 am ET.
Economists expect another 850,000 Americans filed first-time claims for unemployment benefits on a seasonally adjusted basis last week. That would only be 20,000 fewer claims than in the week before.
Continued claims, which count workers who have filed for benefits for at least two consecutive weeks, are expected at 12.2 million, down from 12.6 million in the prior week.
Once again, these expectations are showing us that experts think the recovery is running out of steam.
Less than an hour into the trading day, stocks are sharply higher, with the Dow up 375 points, or 1.4%.
The S&P 500 climbed 1% as well, and the Nasdaq Composite traded up 1.1%.
So what pushed the market up so much after we started the day more muted?
For one, economic data has been looking good today, so that’s helped. But perhaps more importantly, Treasury Secretary Steven Mnuchin shored up hopes for another stimulus deal, saying “we’re going to give it one more serious try to get this done” in an interview with CNBC.
This may have alleviated investors’ worries from last night’s debate, which didn’t help instill faith that a deal would be reachable, according to JJ Kinahan, chief strategist at TD Ameritrade.
US stocks climbed amid rising optimism for further fiscal stimulus. Treasury Sec. Steve Mnuchin said he will speak with House Speaker Nancy Pelosi later Wednesday afternoon to deliver a response stimulus proposal he described as “very reasonable” and “very similar” to the previously-released proposal from the bipartisan Problem Solvers Caucus.
He again listed PPP, money for schools, economic impact payments, back to work credits, retention credits, and more money for the airlines as areas of agreement, later adding that he’s been speaking with airline CEOs on a “constant basis” and will give them an update following his conversation with Pelosi.
Mnuchin described his relationship with Pelosi as “all business,” and said they are effective at communicating together. He expressed hope they would reach a package.
Wall Street opened in the green on Wednesday, as investors digested the prior night’s first presidential debate.
Economic data was broadly positive this morning, with the ADP employment report coming in better than expected (and better than the month before) and the second quarter GDP catastrophe revised up to be slightly less terrible.
The Bureau of Economic Analysis published its third look at US gross domestic product – the broadest measure of the economy – this morning and revised just how bad things were between April and June.
In a nutshell: They were ever-so-slightly better, but still really terrible on the whole.
The GDP collapse was revised to a seasonally-adjusted annualized -31.4%, from -31.7% before. This slight improvement was due to higher consumer spending.
The government updates the GDP number when more data becomes available.
The US economy was in a recession this year, defined as two consecutive quarters of GDP contractions. The first estimate of third-quarter GDP growth is due on October 29, and economists expect a sharp rebound – which would spell the end of the technical recession, even if the economy isn’t recovered fully.
Shares of Palantir, the secretive data analysis company, and Asana, which makes workplace software, are due to start trading on the New York Stock Exchange today.
Each is doing so by directly listing shares rather than through a more traditional initial public offering or super-trendy blank check merger. It’s an unconventional method that’s only been utilized by two other major companies, Spotify (SPOT) and Slack (WORK).
The market value of Palantir, which will trade under the ticker symbol of “PLTR,” is expected to be in excess of $20 billion when it begins trading.
Asana, which will have the ticker “ASAN” market cap will be worth more than $5 billion.
Why go public this way? Going public via direct listing tends to be quicker and involves less scrutiny, since firms are just selling existing shares. It also allows longtime investors to cash out without a flood of new shares diluting the value of their holdings.
This could shake up the IPO market. Depending on how successful these debuts are, there could be more companies choosing to go public this way going forward — especially if private firms are given the green light to raise new money from direct listings as well, as not all startups are able to simply list existing shares. Some may want to still raise funds.
The market is watching. Once shares list, investors will closely watch how they perform in early trading. Asana, in particular, could benefit from huge enthusiasm for software companies as the pandemic drags on.
It’s jobs week and investors and economists alike are anxiously awaiting Friday’s report. But before we get the government numbers, we got the ADP employment report this morning, showing 749,000 jobs added in September on a seasonally adjusted basis.
This was up from only 481,000 jobs added in August. Mind you, the government jobs data looked quite different last month, with 1.4 million jobs added according to the Bureau of Labor Statistics. It’s a good reminder that the ADP number is no forecast for the jobs report.
Large businesses and medium-sized businesses added the most jobs – 297,000 and 259,000, respectively – the ADP report showed. Small business employment is lagging behind, which isn’t a great sign for the health of the recovery.
In terms of industries, trade, transportation and utilities, as well as manufacturing, added the most jobs.
The government’s jobs report is due on Friday – economists expect 850,000 jobs added in September.
Economists warned that layoffs could jump again this fall as government support for businesses wanes and the pandemic continues to hit vulnerable firms.
Those predictions appear to be coming true, with top companies in industries most affected by the coronavirus announcing fresh job cuts this week.
The latest: Disney (DIS) is laying off 28,000 people in the United States as the pandemic hammers its parks and resorts business. Royal Dutch Shell (RDSA), meanwhile, said Wednesday that it will will slash as many as 9,000 jobs as it accelerates a shift away from fossil fuels.
The huge slump in demand for oil and gas caused by Covid-19 restrictions is pushing some of Europe’s biggest energy companies to speed up a shift to cleaner fuels. In June, Shell wrote down the value of its assets by as much as $22 billion and cut its oil price forecasts.
Tens of thousands of airline jobs are also at risk this week.
US airlines promised to keep on workers until October 1 when they accepted federal bailout funds earlier this year. That prohibition ends Thursday. Some carriers say they’ll hold off on layoffs, at least temporarily, while they see if Congress can come together to pass a new stimulus package, but others could start cutting jobs immediately.
The collapse in air travel caused by the pandemic could wipe out up to 46 million jobs worldwide, according to a new report from the Air Transport Action Group.
Wall Street is increasingly concerned that uncertainty surrounding the outcome of the US election in November could roil markets. The debate between President Donald Trump and Joe Biden on Tuesday did little to assuage those fears.
What’s happening: Stocks are lower following an acrimonious and chaotic debate between the two candidates, during which Trump repeatedly interrupted his opponent and failed to engage on questions of policy.
Investors have been particularly worried by Trump’s refusal in recent days to commit to conceding the election if he loses. That could lead to a long period of uncertainty after voters cast their ballots.
On Tuesday, Trump repeated baseless claims about the proliferation of fraud tied to mail-in voting, and declared he wouldn’t support a result under certain circumstances.
“If I see tens of thousands of ballots being manipulated, I can’t go along with that,” Trump said.
It’s the kind of comment that’s causing traders to rush to hedge some bets in case markets go haywire around the election.
A chaotic presidential debate sent stock futures tumbling this morning, after President Donald Trump reiterated that he would not necessarily accept the election results and refused to quell potential unrest that could ensue. Meanwhile, coronavirus cases continue to escalate, yet Trump cast doubt on masks’ effectiveness and said he wanted to quickly open parts of the US economy that remain shut down.
Here’s where things stand this morning.
Stocks ended in the red on Tuesday. A better-than-expected consumer sentiment number yesterday didn’t help markets much, as investors remain skeptical that Washington will come to an agreement on a new stimulus package.
Royal Dutch Shell will slash as many as 9,000 jobs as the oil giant accelerates a shift away from fossil fuels.
The Anglo-Dutch company said Wednesday that it would cut between 7,000 and 9,000 positions by the end of 2022, potentially affecting more than 10% of its workforce. The total includes 1,500 people who have volunteered to leave the company this year.
The job losses are part of an overhaul aimed at cutting costs and simplifying the company’s structure as it moves into low-carbon energy. Shell (RDSA) expects the overhaul to deliver annual cost savings of up to $2.5 billion by 2022.
President Donald Trump says he deserves an “A+” for his handling of the pandemic. Corporate America says he deserves a failing grade.
55% of CEOs and other business leaders give Trump an “F” for his administration’s response to the coronavirus pandemic, according to a poll conducted by the Yale School of Management.
Another 12% say Trump deserves a “D.” Just 6% of the attendees at Yale’s Chief Executive Leadership Institute CEO Caucus award Trump an “A” for his handling of Covid-19.
Facebook, Twitter and Snapchat get all the buzz in the social media investing world. But Pinterest (PINS) has sharply outperformed them all in 2020.
Pinterest stock is up nearly 125% this year, easily outpacing Facebook’s (FB) more than 25% gain and the 40% and 60% jumps for Twitter (TWTR) and Snap (SNAP).
And several analysts think the image-sharing site has even more upside, thanks to Apple’s new look.
Apple’s (AAPL) recent iOS 14 release includes a folder-heavy update that makes it easier to customize iPhone home screens. As a result, there have been several reports about Pinterest downloads hitting records on the App Store in recent weeks, along with people tweeting screengrabs of their new home screens and citing Pinterest posts as an inspiration.
