Markets Close Mixed on Second Wave Fears…..

The U.S. markets closed mixed following a back and forth day, but still finished the week in positive territory. An increase in reported COVID-19 cases in the United States and China has sparked fears of a second wave of the pandemic and put downward pressure on the markets despite recent upbeat economic data and the continued flood of global monetary and fiscal policy relief measures. A Bloomberg report suggesting China plans to boost U.S. agriculture products drove the market early, while crude oil prices rallied, buoying the energy sector. Treasury yields were little changed, the U.S. dollar was higher, and gold gained ground. CarMax posted mixed results but offered upbeat commentary, while Ventas slashed its quarterly dividend by 43%. Apple announced it would be closing stores in several of the states experiencing upticks in COVID-19 cases, further contributing the second wave of coronavirus uneasiness. Europe and Asia both extended a solid weekly advance with major indices closing higher.

The Dow Jones Industrial Average fell 209 points (0.8%) to 25,871, the S&P 500 Index decreased 18 points (0.6%) to 3,098 and the Nasdaq Composite gained 3 points to 9,946. In heavy volume, 1.0 billion shares were traded on the NYSE and 4.4 billion shares changed hands on the NASDAQ. WTI crude oil pushed $0.91 higher to $39.75 per barrel and wholesale gasoline was $0.01 higher at $1.27 per gallon. Elsewhere, the Bloomberg gold spot price advanced $19.98 to $1,742.90 per ounce, and the Dollar Index—a comparison of the U.S. dollar to six major world currencies—was up 0.2% at 97.62. For the week, the markets finished solidly higher, as the DJIA added 1.0%, the S&P 500 gained 1.9%, and the Nasdaq Composite increased 3.7%.

Despite today’s back and forth action, U.S. stocks still were able to get back on the weekly winning track, bouncing back after last week’s tumble that stymied a three-week rally. The equity markets resumed an upward trajectory that has the Nasdaq back to near all-time highs and the S&P 500 within striking distance of positive territory for the year, bolstered by three-main catalysts.

Treasuries ticked higher to close out the week, with the economic calendar void of any major releases today, with the yield on the 2-year note dipping 1 basis point to 0.19%, while the yields on the 10-year note and the 30-year bond fell 2 bps to 0.70% and 1.46%, respectively.

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