De S&P 500 index (SNPINDEX: ^ SPX) gained 12.7 points, as a solid 1%, on August 12, and joined the other major indices with a better-than-1% gain on the day, following the announcement yesterday that presidential hopefuls and former vice- President Joe Biden’s choice for running mate. Kamala Harris, the U.S. senator from California, is running for the Biden ticket as the Democratic nominee for vice president.
On a day that unveiled no major revenue as economic news, Harris’ announcement is the biggest market-moving news of the day. The currently best performing S&P files were semiconductor giants Advanced micro-devices (NASDAQ: AMD), Qualcomm (NASDAQ: QCOM), en NVIDIA (NASDAQ: NVDA), up 7.5%, 6.4%, and 5.4% today as investors look to take advantage of strong demand for microchips.
Image Source: Getty Images.
Profits were broad, with well over 300 of the S & P 500’s 505 components rising higher, seven sectors gaining 1% or more on the day, and only the financial sector declining.
Wall Street starts pricing in the Dem ticket
Without making this a political conversation, the current market reaction is probably at least due to the general perception that Harris, who served as a lawyer in California for her career in elected office, is more moderate in her fiscal views, while being socially liberal. is.
There are serious concerns of the financial sector, as evidenced by the decline in many financial and banking stocks on the day. While serving as attorney general in California, Harris played a major role in holding banks accountable for their role in the housing crisis a decade ago. California was one of the hardest hit states in terms of assets.
Looking directly above Harris, it is likely that investors also saw themselves as a preferred candidate for other high-profile opportunities with positions that could have a greater impact on corporate profits. Not only does the election speak to its political lies, but it provides some clues as to where a Biden campaign, and potential presidency, will set its priorities.
Put it all together, and the market values predictability. Now that the big cards are clear, investors can begin to price in their expectations based on who is likely to hit the White House in November.
Chipmakers sear on the upside
The demand for microchips is strong, and AMD, NVIDIA, and Qualcomm are all running higher. Since the market base at the end of March, they have both the wider S&P 500 and the NASDAQ Composite:
AMD Total Return Price data by YCharts
At the same time chip giant Intel (NASDAQ: INTC) has stumbled, with shares 17% down so far this year and almost flat since the bottom of 2020 when the company falls behind AMD on its next-gen chipset.
But investors should not sleep on Intel, especially if it gets its action together. You should not ignore its competing competitors either. The future looks bright for the entire sector.
College football and Disney: Downside and upside
Two of the “Power Five” college athletics conferences said they would not play football this fall, with the PAC 12 and Big 10 making announcements this week. To date, however, the Southeastern Conference, Atlantic Coast Conference, and Big 12 have not made such announcements. Conversely, the Big 12 announced their planning plans this week, while both SEC and ACC officials have said they still intend to play, but will follow the advice of medical advisors.
Above the implications of the health risks for players, officials, coaches, and training staff, there are financial implications for Disney (NYSE: DIS), which owns both ESPN (Home of the Big Conferences) and Fox Broadcasting. The loss of a fall college season football would erase some of Disney’s most valuable content; however, as the three remaining major conferences continue with games in the fall, Disney could look even higher than usual viewership – promoting ad improvement – with more people choosing to stay home and looking for entertainment.
Like politics, let us not venture on the ethical as well as health implications. However, Disney’s sports networks could face some serious programming challenges on Saturday, September.
