Ethan More September 15, 2023

Despite growing optimism for additional coronavirus boost, U.S. equities rose in choppy trading on Wednesday, but major averages still recorded their first down month since March.

After rising by 573 points at its session high, the Dow Jones Industrial Average closed up 329.04 points, or 1.2%, to 27,781.70. The tech-heavy Nasdaq Composite increased 0.7%, or 82.26 points, to 11,167.51, while the S&P 500 increased 0.8%, or 27.53 points, to 3,363.00.

After House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin failed to reach an agreement on coronavirus aid, stocks gave up gains in the final hour of trade. As they work to create a fifth package that might be approved by both chambers of Congress, the two will continue their discussions. Early in the session, the market jumped as Mnuchin declared that senators were giving the bill “a serious try.”

Better-than-expected economic figures boosted sentiment. In September, the monthly private-sector jobs count from ADP indicated growth of 749,000, exceeding the 600,000 forecast from a survey of Dow Jones economists. The National Association of Realtors survey shows that pending home sales increased by 8.8% in August, the highest rate ever.

Banks and cruise operators were among the biggest gainers on Wednesday, as were other stocks that are susceptible to the economic rebound. While Citigroup increased 1.6%, Goldman Sachs increased by more than 2%. Boeing rose 1%, and Norwegian Cruise rose more than 3%.

Still, a tech-driven slump earlier in September contributed to the major averages’ first monthly declines since March. While the Dow and the Nasdaq Composite declined 2.3% and 5.2%, respectively, in September, the S&P 500 plummeted 3.9% this month.

vicious first discussion

Investors digested Tuesday night’s first debate between Democratic contender Joe Biden and President Donald Trump, which turned out to be especially abrasive with frequent interruptions and attacks. Wall Street is still afraid that the market may be hurt by a protracted electoral process.

Daniel Deming, managing director at KKM Financial, stated that it had been a hard night and that there was much to be resolved. “I think the market is probably not too crazy about that,” the trader said, “because it became pretty obvious that this thing is not going to be over on Nov. 3.”

“After this debate, the pressures on short-term volatility surely won’t go away anytime soon. In a sense, it increases uncertainty, according to Deming.

Trump and Biden argued about a number of topics, including their suitability to run the American economy, Amy Coney Barrett’s appointment to the Supreme Court, and how the country handled the coronavirus pandemic.

The uncertainty surrounding the election has been mentioned by several market strategists as a significant headwind for the market before year-end, with each outcome offering its own risks and benefits. Some investors are worried about a possible Biden victory because they think it may result in more corporate taxes and stricter restrictions. However, it might also allay worries about the trade conflict and the lack of economic stimulation following the coronavirus.

Investors are also concerned that neither candidate will concede if the Nov. 3 vote is too close to call. The market may be particularly affected by this uncertainty.

Even though experts have repeatedly stated there is no proof of voter fraud ever occurring in the United States, Trump routinely asserts that mail-in voting causes it.

“Questions on election fraud were raised, which will add to concerns about a volatile post-election period if there is a close or uncertain electoral outcome,” wrote Raymond James’ Ed Mills in a note headed “Dumpster Fire Debate.”

Hopes for virus treatment

Positive information from Regeneron Pharmaceuticals about a possible coronavirus cure helped improve the mood on Wall Street.

After the market closed on Tuesday, Regeneron said that their REGN-COV2 treatment decreased viral levels and improved symptoms in coronavirus patients who were not hospitalized.

The experimental COVID-19 vaccine from Moderna, on the other hand, is secure and appears to be effective in older people, according to research findings that were published in the New England Journal of Medicine. Moderna’s vaccination won’t be ready before the November election, according to a Financial Times report published on Wednesday.

Following the announcement that 28,000 employees in its theme parks sector would be laid off, Disney’s stock fell more than 1% on Wednesday.