2020-10-12 22:05
publication
2020-10-12 22:05
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Monday saw solid gains on the New York Stock Exchanges. The stocks of fashionable technological giants, in particular, rose significantly. The pretext for the increase, as usual, was speculation related to fiscal “stimulants”.
Apple’s shares rose by over 6%. On Tuesday, the company is to show the latest iPhone. Amzon’s stock rose by almost 5%. The annual “Prime Day” starts on October 13, encouraging consumers to buy online. Add to this the 2.6% more expensive Microsoft securities (apparently unnecessary excuse) and we have a recipe for a strong upward session on Wall Street. After all, each of these companies “weighs” well over a trillion dollars.
Hence, we get a 2.56% rise in Nasdaq, again approaching the September 2 all-time high of nearly 12,070 points. On the same engine, the S & P500 increased by 1.64%, climbing to 3,531.10 points. and also returning close to the historic record. The Dow Jones was clearly weaker, rising by 0.88% and finishing with a result of 28,838.04 points.
It is all about whether American politicians will vote on the second package of gigantic fiscal expenditures financed by rising public debt before the elections on November 3. I am talking about a sum of $ 2 trillion.
– It seems that the administration wants an agreement before the elections. Now it is up to the Republican-controlled Senate how big the number will be – summed up Brian Battle of Performance Trust Capital Partners, quoted by Reuters.
Polls give a Democratic candidate more and more chances. Joe Biden announces significant tax increases, especially for stock market investors and US corporations. Biden’s win also means more bureaucracy, more federal government power and a reversal of the deregulation carried out by Donald Trump. Nevertheless, Wall Street is not afraid of such results of the November election, counting on more generous fiscal stimulus and greater infrastructure spending.
The most important season of publication of Q3 results will also start on Tuesday. Analysts estimate that the profits of companies in the S & P500 (EPS) index were over 20% lower than a year ago, but also significantly higher than in the disastrous Q2. Investors have already accounted for a marked increase in EPS in this and the coming quarters. Better that the boards of companies do not disappoint them.
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