Stocks Falter After Run Toward Record Highs…..
U.S. stocks moved lower after posting a string of gains that put U.S. equities back in record high territory. Positive sentiment regarding a COVID-19 vaccine and cautious optimism of further fiscal relief seemed to hold losses somewhat in check early, however a lack of clarity on actual progress toward fiscal stimulus and potential near-term implications of the recent rise in virus cases remained drags on the markets. In mixed economic news, the pace of job openings accelerated for a second-straight month and wholesale inventories came in stronger than expected, while mortgage applications declined. Dow member JPMorgan Chase & Co’s CEO Jamie Dimon offered encouraging commentary and Lowe’s Companies announced a new share repurchase program and upbeat margin guidance, while FireEye reported that it had been hacked. Treasury yields moved higher as bond prices slid, and the U.S. dollar rose following a recent plunge. Crude oil prices were down slightly and gold fell. Asia finished mostly higher, though China fell following some disappointing inflation figures. Europe was also mostly higher across the major indices as the vaccine optimism was somewhat offset by Brexit deal uncertainty and caution ahead of tomorrow’s European Central Bank monetary policy decision.
The Dow Jones Industrial Average fell 105 points (0.4%) to 30,069, the S&P 500 Index was down 29 points (0.8%) at 3,673, while the Nasdaq Composite declined 244 points (1.9%) to 12,339. In heavy volume, 1.1 billion shares were traded on the NYSE and 5.1 billion shares changed hands on the Nasdaq. WTI crude oil was $0.08 lower at $45.52 per barrel and wholesale gasoline added $0.02 to $1.26 per gallon. Elsewhere, the Bloomberg gold spot price fell $31.60 to $1,839.97 per ounce, and the Dollar Index—a comparison of the U.S. dollar to six major world currencies—increased 0.1% to 91.04.
Job openings jump, mortgage applications decline, Treasury yields resuming climb…..
The Labor Department’s Job Openings and Labor Turnover Survey (JOLTS), a measure of unmet demand for labor, showed 6.65 million jobs were available to be filled in October, versus the Bloomberg consensus forecast calling for 6.30 million jobs, and up from September’s positively-revised 6.49 million figure. The report showed the hiring rate dipped to 4.1% from September’s 4.2% rate and separations rose to 3.6% from the prior month’s 3.4% pace.
The MBA Mortgage Application Index declined by 1.2% last week, following the prior week’s 0.6% dip. The decrease came as a 1.8% rise in the Refinance Index was more than offset by a 5.0% drop in the Purchase Index. The average 30-year mortgage rate declined 2 basis points (bps) to 2.90%.
October wholesale inventories were unexpectedly revised higher to a 1.1% rise, versus expectations to be unadjusted at the preliminary estimate of a 0.9% gain, which would have matched September’s upwardly-revised rise. Sales increased 1.8% after September’s upwardly-revised 0.4% gain.
Treasuries were mostly lower, with the yield on the 2-year note little changed at 0.15%, while the yields on the 10-year note and the 30-year bond gained 2 bps to 0.93% and 1.68%, respectively.
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