Benchmarks closed sharply lower on Monday as possibilities over a fresh stimulus package remain doubtful before the presidential election.
The Dow Jones Industrial Average (DJI) fell 410.89 points or 1.4%, to close at 28,195.42 and the S&P 500 slipped 56.89 points, or 1.6% to close at 3,426.92. The Nasdaq Composite Index closed at 11,478.88, declining 192.67 points, or 1.7%. The fear-gauge CBOE Volatility Index (VIX) increased 6.5%, to close at 29.18. Declining issues outnumbered advancing ones for 2.67-to-1 ratio on the NYSE and a 2.30-to-1 ratio on the Nasdaq favored decliners.
How Did the Benchmarks Perform?
The Dow and the S&P 500 posted their worst daily percentage decline since Sep 23, per Dow Jones Market Data, as quoted in a MarketWatch article, while the Nasdaq recorded its biggest one-day loss since Oct 2 this year. The tech-laden index also logged its first five-day losing streak since August 2019. Decline in big tech companies pushed the index lower. Shares of Alphabet Inc. GOOGL, Microsoft Corporation MSFT, Apple Inc. AAPL and Amazon.com, Inc. AMZN closed at least 2% lower for the session
Additionally, uncertainties over new stimulus package and rise in coronavirus cases have particularly weighed on travel and leisure companies, with Marriott International, Inc.’s MAR shares declining3 .9% on Monday. Marriott Internationalcarries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Sell) stocks here.
Majority of the Dow components closed in the red, with Apple and Johnson & Johnson JNJ emerging as the biggest losers, dropping 2.6% each for the session. All the 11 major sectors of the S&P 500 ended in the red, with energy leading the slump dropping 2.1% on Oct 19.
Overall, the S&P 500 posted 25 new 52-week highs and 1 new low, while the Nasdaq Composite recorded 101 new highs and 29 new lows.
Lawmakers Struggle to Reach Stimulus Deal
Global coronavirus cases have jumped past 40 million in the past week and grew by 5% or more across 38 states in the United States as of Friday. The news was already acting as a damper on market sentiment and uncertainties of a new coronavirus stimulus before the Nov 3 Presidential election weighed heavily on stocks yesterday.
On Monday, House Speaker Nancy Pelosi and Treasury secretary Steve Mnuchin narrowed differences on to push through a stimulus package. However, Pelosi was hopeful that by the end of Tuesday there will be clarity on whether the new bill will be possible before the election. According to White House chief of staff Mark Meadows, the White House has increased its stimulus offer to almost $1.9 trillion. He also said that President Donald Trump is willing to raise direct payments to households and small-businesses to help keep small restaurants, hotels and others stay afloat.
Home-builder Confidence Edge Higher in October
On Oct 19, the National Association of Home Builders (NAHB) reported that its monthly confidence index edged up two points to 85 in October. The index reading now hits a record high for the third month in a row. The association states that it is only the second time that the confidence measure was at or above 80. Additionally, the NAHB report also showed that the index that measures sentiment regarding current sales conditions increased to 90 and the expectations for future sales over the next six months index rose to 88.
These Stocks Are Poised to Soar Past the Pandemic
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Click to get this free report Microsoft Corporation (MSFT) : Free Stock Analysis Report Johnson Johnson (JNJ) : Free Stock Analysis Report Marriott International, Inc. (MAR) : Free Stock Analysis Report Amazon.com, Inc. (AMZN) : Free Stock Analysis Report Apple Inc. (AAPL) : Free Stock Analysis Report Alphabet Inc. (GOOGL) : Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research