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US stocks end mixed as investors weigh coronavirus stimulus package negotiations

For the week, the S&P 500 lost 0.5% while the Dow and Nasdaq dipped 0.95% and 1.1%, respectively

Wall Street
Wall Street started mixed on Friday

4:05 pm: US equities end in a mixed session 

US stocks ended mixed as investors weighed ongoing negotiations between Congress and the White House for a new coronavirus stimulus package before the November 3 election. 

On the day, the DJIA fell 28 points, or 0.10%, to 28,335, snapping a 3-week winning streak. But the S&P 500 increased 0.34% to 3,465 and the tech-heavy Nasdaq rose 0.37% to 11,548 -- yet posted its first weekly loss in five weeks. 

The S&P 500 lost 0.5% for the week. The Dow and Nasdaq dipped 0.95% and 1.1%, respectively.

12:20 pm: Wall Street tumbles into the red

The Dow Jones Industrial Average gave back its early gains, as has been the pattern this week. The index went from up about 70 points to down 88, 0.3%, just after noon ET. The Nasdaq Composite dropped 34 points, 0.3%, to 11,471.4, and the S&P 500 fell 2.6 points, less than 0.1%, to 3,450.9.

"The session on Wall Street is mixed as there hasn’t been much enthusiasm from traders," Madden wrote. "Once again, there has been a lot of talk about the proposed US stimulus package, but at the same time, differences of opinion still exist, according to Larry Kudlow – an economic advisor to Mr Trump. It seems that the chances of a deal being struck before the Presidential election are dwindling." 

Tech stocks struggled, as some analysts believe a Democratic sweep on November 3 could be harmful for the sector. 

“We see a Democratic sweep as having the most uncertainty and tail risk for [the] large-cap internet sector,” Bank of America analysts said in a note, per CNBC.

Apple Inc (NASDAQ:AAPL) lost 1.1% to $114.43, and Amazon.com Inc (NASDAQ:AMZN) dropped 0.7% to $3,155.02.

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9.45am: US benchmarks start mixed

US benchmarks started the last day of the trading week in mixed mood as traders look ahead to the release of economic data this morning and continue to mull whether a stimulus deal will be struck or not.

Last night saw the final debate before the November 3 election between President Donald Trump and Joe Biden and commentators says markets are likely to be jittery and lack direction before the decisive vote next month.

In early Wall Street deals, the Dow Jones Industrial Average  added over 51 points at 28,414.

The S&P 500 gained over eight points at 3,462. The tech-heavy Nasdaq  fell into the red though, shedding around nine points at 11,496.

This morning sees the release of data for the manufacturing and services sectors this month (October), which will cast more light on the pace or lack thereof of the US recovery.

Investors are also wading through another batch of corporate earnings. Chip maker Intel (NASDAQ:INTEL) shares plunged over 10% to US$48.42 after it posted quarterly results after hours yesterday. It reported third-quarter net income of US$4.3 billion, down over 28% from US$5.99 billion in the same period of 2019.

7.30am: US stocks poised for higher start

US stocks look set to start Friday on the front foot after the latest US presidential debate on Thursday night failed to spook investors and as Treasury Secretary Steven Mnuchin and Congressional Democrat leader Nancy Pelosi work towards a coronavirus stimulus package, with corporate earnings also offering some encouragement.

Futures for the Dow Jones Industrial Average rose 74 points, or 0.3%, to 28,342, while S&P 500 futures gained 0.2%, and the Nasdaq 100 futures were also up 0.2%.

On Thursday, the Dow rose 152.84 points, or 0.5%, to close at 28,363.66, while the S&P 500 added 0.5%, and the Nasdaq Composite gained 0.2%. All the major indexes are set for small losses on the week.

Craig Erlam, senior market analyst, OANDA Europe commented: “Pelosi's optimism on a deal with the White House wasn't hugely shared on Wall Street on Thursday, with the Senate still being a massive hurdle blocking a stimulus package before election day. Trump was once again optimistic that he could push any agreement through the Senate, a view not shared by majority leader, Mitch McConnell.

“Obviously a deal between Mnuchin and Pelosi would be a step forward which may provide a minor lift, not to mention pile pressure on some Republican Senators just ahead of election day. Voting down a stimulus package days before an election could be a damaging blow to a Senator in a close fight for re-election. Perhaps this is what Trump is banking on.”

Erlam added: “The next couple of weeks will be really interesting in these markets and we may see a lot of choppiness due to the considerable amount of uncertainty that will accompany it. The final debate was a far easier watch than the last, with both candidates giving a better account of themselves. The question is whether Trump has done enough to close a considerable gap.”

Five things to watch on Friday:

  • Gilead Sciences Inc shares rose 6% on Friday after its antiviral drug, remdesivir, became the first and only approved treatment for coronavirus (COVID-19) in the United States. The US health regulator’s approval on Thursday for its use in hospitalized patients came despite the World Health Organization last week saying the drug did not have a substantial effect on patients’ length of hospital stay or chances of survival in a global trial.
  • Two of Apple Inc’s (NASDAQ:AAPL) latest iPhone 12 models went on sale in China on Friday, after early pre-order data showed strong consumer interest in the 5G-enabled device in the firm’s second-largest market. The short queues outside Apple stores in the business hub of Shanghai struck a contrast with the crowds that flocked to past launch events, as most ordering has now shifted online.
  • Intel Corp (NASDAQ:INTC) saw its margins tumble in the third quarter as consumers bought cheaper computers and businesses clamped down on data center spending in the face of the coronavirus pandemic. The numbers, posted after the New York market close on Thursday, showed the chipmaker earned $1.11 per share in the quarter to September 30, 2020,  excluding one-off items, which was in line with estimates. But operating margins were down to 36% in the quarter from 44% a year earlier.
  • American Express Co (NYSE:AXP) reported a nearly 40% slump in quarterly profit on Friday, hurt by lower spending by its users, while it also set aside $665 million for potential defaults. Net income fell to $1.07 billion, or $1.30 per share, for the third quarter ended September 30, from $1.76 billion, or $2.08 per share, a year earlier.
  • Wells Fargo & Co (NYSE:WFC) is exploring a sale of its asset management business, in what would be the US bank’s biggest shake-up since former Bank of New York Mellon chief executive Charles Scharf joined as CEO last year, Reuters has reported, citing people familiar with the matter on Thursday.

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