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All four major US stock indices fell across the board on Wednesday (14). The launch of the COVID-19 vaccine may be delayed, keeping investors on the sidelines. US Treasury Secretary Steven Mnuchin candidly admitted the Democratic Party stimulus plan. There are still “big differences” and the hope of reaching an agreement before the elections is fading.
Mnuchin’s pessimistic comments dealt a further blow to fragile market sentiment. Earlier on Wednesday, major Wall Street banks released mixed results for the third quarter, and two clinical trials of the new corona pneumonia vaccine on Tuesday called cards one after another.
May Mnuchin said Wednesday that he and House Speaker Nancy Pelosi had “major disagreements” on certain details of the stimulus plan. “Just considering our current progress and the differences in the details, it is difficult to come to an agreement and put it into practice before the elections, but we will continue to work hard to solve these problems.”
Amazon led the decline in tech stocks, bank stocks were weak, stocks of indexed banks S&P 500 fell 2.4%, Bank of America fell 5.3% and Wells Fargo fell 6%.
The US corporate earnings season has started and signs are that the extent to which US companies are affected by the epidemic may improve. Based on data from Refinitiv IBES, analysts predict that corporate profits will decline by 19% compared to the same period last year, which is a slower decline than the 25% forecast on July 1.
The global epidemic of new corona pneumonia (COVID-19) continues to spread. The World Health Organization (WHO) has warned that Canada faces a second wave of epidemics. Almost 80% of the cases are from Quebec and Ontario, the two most populous places.
According to real-time statistics from Johns Hopkins University in the United States, the number of confirmed cases worldwide has exceeded 38 million and the number of deaths reached 1,089 million. The cumulative number of confirmed cases in the United States so far has approached 7.9 million, and at least 216,000 have died.
The performance of the four main US stock indices on Wednesday (14):
- The Dow Jones Index fell 165.81 points, or 0.58%, to close at 28,514.00 points.
- The S&P 500 Index fell 23.26 points, or 0.66%, to close at 3,488.67 points.
- The Nasdaq index fell 95.17 points, or 0.80%, to close at 11,768.73 points.
- The Philadelphia Semiconductor Index fell 12.93 points, or 0.53%, to close at 2,417.20 points.
The five kings of technology are weak: Apple (AAPL-US) rose 0.07%; Facebook (FB-US) fell 1.56%; Alphabet (GOOGL-US) fell 0.23%; Amazon (AMZN-US) fell 2.32%; Microsoft (MSFT-US) fell 0.90%.
Most of the 30 shares of Dow Jones fell: United Health (UNH-US) fell 2.89%; Salesforce (CRM-US) fell 1.87%; Disney (DIS-US) fell 1.84%; Verizon (VZ-US) fell 1.57%; Boeing (BA-US) was up 0.68%.
Fei half of the constituent shares fell more and rose less. Ke Lei (KLAC-US) fell 1.79%; ASML (ASML-US) fell 1.76%; AMD (AMD-US) fell 1.25%. Qualcomm (QCOM-US) was up 1.9%.
Kelin Research and Development (LRCX-US) fell 0.60%; Applied Materials (AMAT-US) fell 0.77%; Microchip (MCHP-US) fell 1.39%.
Taiwan ADR shares almost closed: TSMC ADR (TSM-US) fell 1.16%; ASE ADR (ASX-US) fell 1.64%; UMC ADR (UMC-US) increased 0.92%; Chunghwa Telecom ADR (CHT-US) fell 0.08%.
Focus actions
Shares of Apple (AAPL-US) rose slightly 0.07% to $ 121.19 a share. Apple released the iPhone 12 on Wednesday, and the price and features are roughly in line with market expectations.
Shares of Tesla (TSLA-US) rose 3.3% to $ 461.30. Chief Executive Elon Musk dropped a shock bomb on Twitter on Wednesday. This week, the price of the US Model S Long Range dropped for the second time. It is now down to $ 69,420, which is earlier than rival Lucid Air on the same day. It’s cheaper.
Bank of America (BAC-US) fell 5.33% to $ 23.62. Bank of America’s third-quarter revenue fell 11% annually and was not as good as market expectations, and net income fell as well. Wells Fargo Bank (WFC-US) also fell 6.02% on worse-than-expected earnings.
Goldman Sachs (GS-US) was up 0.2% at $ 211.23. The company’s revenue in the third quarter increased 30% annually and profits nearly doubled.
United Health (UNH-US) fell 2.9%. Although the company raised its earnings forecast, it cautioned that it is difficult to predict the impact of the epidemic on its performance.
Fastly (FSLY-US), the cloud provider, was hit by the ban on TikTok, its largest customer, and plunged 28% after the market. He was quick to say that third-quarter revenue may not be as good as the company originally expected, reflecting the unavailability of TikTok software due to the US ban, which affects its revenue.
Economic data
- US September PPI Annual Growth Rate Reported 0.4%, Expected 0.2%, Previous Value-0.2%
- The monthly increase rate of the US PPI in September reported 0.4%, which is expected to be 0.1%, and the previous value is 0.3%
- The annual growth rate of the basic US PPI was reported in September 2%, 0.9% expected, previous value 0.6%
- The monthly rate of increase of the basic US PPI in September registered 0.4%, which is expected to be 0.2%, and the previous value is 0.4%.
Wall Street Analysis
Mike Zigmont, Head of Trade and Research at Harvest Volatility Management, said: “Optimism has skyrocketed and has now receded. I think the news of the stimulus plan has been reflected in the share price. Now it’s just the details of when the stimulus will be announced and when the stimulus will go into effect. The problem. “
Mark Hackett, head of investment research at Nationwide, said the likelihood of a deal between the White House and Democrats is gradually diminishing, but investors continue to pay attention and react to the progress of the stimulus plan; the gap between Democrats in the House of Representatives and the White House has narrowed to about 4,000. Millions of dollars … Even though they still have differences in state and local government funding, medical relief, and shared tax credits. “
Brent Schutte, chief investment strategist at Northwest Mutual Wealth Management, said: “The overall corporate financial report is good today. Earnings growth was originally concentrated in a few companies and will expand to more stocks and companies.”
Federal Finance Corporation chief investment officer Brad McMillan said the market now expects the elections to go smoothly, large-scale fiscal stimulus and an end to the pandemic, and expects the economy to return to normal levels in 2019 early next year; But that optimism makes the market particularly vulnerable. The news affects, especially, the number of confirmed cases of new coronary pneumonia in some areas is increasing dramatically.
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