Close Update: Stocks Start Week Lower as COVID-19 Cases Grow, Stimulus Plan Remains Elusive, Pre-Election Jitters Arise

Monday, October 26, 2020 5:25 PM | MT Newswires

US stocks were indicated to start the week lower as COVID-19 cases continued to rise and expectations cooled for a bipartisan stimulus deal ahead of the elections on Nov. 3.

The Dow Jones Industrial Average dropped by 2.3% to 27,685.38 and the S&P 500 slid by 1.9% to 3,400.97, while the Nasdaq Composite fell by 1.6% to 11,358.94. Energy and industrials were among the steepest decliners, with all sectors in the red on Monday.

The West Texas Intermediate futures retreated by 3.3% to $38.54.

Both the single-day number of US cases and the seven-day moving average hit new records over the weekend, and the third wave of coronavirus cases continues to broaden, according to a report from Pantheon Macroeconomics. New cases hit 83,800 on Friday, beating the previous record high of 77,400 on July 16. The 60,800 recorded on Sunday was up by 26% from a week ago.

The trend rate of increase is now about 23% per week, and rising, and "if this rate persists, [this coming] Friday will see the first day with more than 100,000 confirmed cases," Ian Shepherdson, chief economist at Pantheon, said. "The most severe outbreaks are still in the upper Midwest, but the number of states with both high levels of cases and rapid increases is rising."

House Speaker Nancy Pelosi and White House Chief of Staff Mark Meadows accused each other of "moving the goalposts," a report from Stifel said.

"Pelosi is waiting for another counteroffer today from Treasury Secretary Steven Mnuchin, though there remains a disagreement over funding to stem the pandemic and aid related to education," Stifel cited reports as saying. "At this point, reaching a deal ahead of the November election appears improbable, if not entirely impossible."

In company news, Hasbro (HAS) fell by 9.4%, the second worst performer on the Nasdaq, as its third-quarter revenue dropped year-on-year, even though sales were ahead of expectations.

Meanwhile, BioSig Technologies (BSGM) tumbled almost 40% after saying its ViralClear subsidiary was ending phase 2 testing of a combination of its merimepodib enzyme inhibitor and Gilead Science's (GILD) remdesivir anti-viral in adult patients with advanced COVID-19.

In the precious metals markets, gold was slightly lower to $1,904.50 an ounce, with silver down 1.2% to $24.37 an ounce and copper down 1.1% to $3.09 per pound.

Among energy ETFs, the United States Oil Fund fell 2.8% to $27.11 and the United States Natural Gas Fund was up 1.7% to $12.30. Among precious-metal funds, the Market Vectors Gold Miners ETF was down 1.6% to $38.21 and SPDR Gold Shares were slightly lower to $178.55. The iShares Silver Trust was down 1.4% to $22.61.

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