Dow Plunges 300 Points After New Coronavirus Cases Hit Another Record High Just 8 Days Before Election

Topline

Stocks are tanking Monday as growing concerns over a surge in coronavirus cases both domestically and globally rattle investor sentiment just eight days before the November presidential election. Hundreds of firms–including tech giants like Amazon and Alphabet are set to report earnings this week, amid the heightened market volatility, while investors also eye ongoing negotiations in Washington for another stimulus bill.

Key Facts

Key Background

The ongoing surge in new domestic coronavirus cases–which continue to reach record highs–is rattling investor sentiment as it threatens to hinder an already sluggish economic recovery that Fed Governor Lael Brainard said just last week remains “highly uncertain and highly uneven—with certain sectors and groups experiencing substantial hardship,” adding that another stimulus bill would be “needed” to turn the recovery into a “broad-based and inclusive recovery.”  Meanwhile, the stalemate in Washington over stimulus seemingly continues as House Speaker Nancy Pelosi (D-Calif.), as of Sunday, says she’s still waiting to hear back from the White House on a list of remaining disagreements Democrats have with the Trump Administration.

What To Watch For

Amid what could be the height of preelection uncertainty, hundreds of companies–including about one-third of S&P 500 firms–are set to report earnings this week, including cloud firm Twilio after the market closes on Monday, biotechs Eli Lilly, Merck and Pfizer on Tuesday, Ford and Boeing on Wednesday and a slew of big tech firms—including Alphabet, Amazon and Twitter—on Thursday.

Crucial Quote 

This week “represents a major week for tech investors as [Facebook, Apple, Amazon and Alphabet] earnings on Thursday after the bell will be a seminal night for the Street to digest how these tech stalwarts are faring during this COVID backdrop and semi-lockdown environment,” said a team of Wedbush analysts led by Daniel Ives in a recent note. “The reality is that the strong are getting stronger with FAANG names such as Amazon, Facebook, Google, and Apple beneficiaries of the current environment and a dynamic that will be front and center… which we believe will put further fuel into the tech rally moving forward into year-end with the elections and a potential Blue Wave creating more volatility over the next month for tech stocks.”

Tangent

Ant Group, the financial technology arm of Chinese e-commerce giant Alibaba, plans to raise $34.5 billion when it lists its shares on the Hong Kong and Shanghai stock exchanges—that would make its initial public offering the largest in history. 

Further Reading

Dow Flat As Markets Continue To Price In Biden Election Victory After Final Debate (Forbes)

Ant Group Will Raise $34.5 Billion In Biggest IPO Ever (Forbes)

1.3 Million American Households Could Owe $7.2 Billion In Unpaid Rent By End Of This Year (Forbes)

Pelosi Says Stimulus Bill Could Happen Before Election–But That Seems Unlikely (Forbes)