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US open: Stocks record early losses as stimulus talks remain in focus

By Iain Gilbert

Date: Monday 19 Oct 2020

US open: Stocks record early losses as stimulus talks remain in focus

(Sharecast News) - Wall Street stocks were lower after the bell on Monday as a continued rise in the number of new Covid-19 cases and stalled stimulus talks remained in focus.
As of 1530 BST, the Dow Jones Industrial Average was down 0.17% at 28,556.30, while the S&P 500 was 0.09% weaker at 3,480.60 and the Nasdaq Composite came out the gate 0.05% softer at 11,665.26.

The Dow opened 50.01 points lower on Monday, cutting into gains recorded on Friday when the index snapped a three-day losing streak.

In focus at the open was data from Johns Hopkins University which showed Covid-19 cases were growing by 5% or more in 38 US states as of Friday, while nationwide, the daily case average had risen by more than 16% week-on-week to almost 55,000.

Also taking up much of investors' attention were comments from House Speaker Nancy Pelosi's office on Saturday that she would be allowing the Trump administration 48 hours to reach an aid deal before the 3 November election as Pelosi and Treasury Secretary Steven Mnuchin continued talks over the weekend and agreed to speak again on Monday.

"The 48 only relates to if we want to get it done before the election, which we do," said Pelosi on Sunday. "We're saying to them, we have to freeze the design on some of these things - are we going with it or not and what is the language? I'm optimistic, because again we've been back and forth on all this."

Some solid macro data out of China had initially boosted sentiment ahead of the open, with the world's second-largest economy posting a third-quarter gross domestic product growth of 4.9%.

On the US macro front, the National Association of Housebuilders/Wells Fargo housing market index posted a record high for the second month in a row. The index came to 85 for October, a marked improvement on the reading of 71 seen a year earlier, as all three components of the index either set records or matched their highest reading - with current sales conditions rising two points to 90, sales expectations for the next six month growing three points to 88 and buyer traffic remaining flat at 74.

Turning to the Federal Reserve, chairman Jerome Powell discussed cross-border digital currencies with the International Monetary Fund, while vice chairman Richard Clarida will deliver comments at 1645 BST, Atlanta president Raphael Bostic will talk at 1930 BST and Philadelphia president Patrick Harker will make an address at 2000 BST.

In the corporate space, Halliburton shares were up after the group posted third-quarter adjust profits that topped expectations, while ConocoPhillips shares were after confirming that it was set to buy Concho Resources in a $9.7bn all-stock deal.

IBM will report earnings after the close on Monday, while heavy hitters Netflix and Tesla will post their latest quarterly report cards later in the week.

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