Last Week Recap:
Markets finished the week down (S&P 500 -0.5%, Dow -0.9%, NASDAQ -1.1%) with the focus still primarily on stimulus headlines. However, we saw solid economic and earnings numbers last week. So far around 27% of S&P 500 companies have reported earnings with 84% of them beating estimates which is much higher than the 5 yr average beat of 73%. We also saw business optimism rise significantly primarily due to hopes for a vaccine and additional stimulus. Also, the housing market has continued to shine with such low rates as both building permits and new home sales posting great numbers. The hopes for future economic growth can be seen in the market numbers as well with the 10 yr Treasury yields rising to their highest level in quite sometime.
Futures are starting the week on a sour note as we have seen new Covid cases surge over 83,000 for Friday and Saturday. Also, with additional commentary suggesting that a stimulus package is unlikely before elections. Although, the election, Covid and stimulus talks will undoubtedly dominate the headlines with only 7 trading days left until the election. This will be a big week for earnings and we will get numbers from Facebook, Amazon, Apple, Microsoft and Google. We will also get data on consumer confidence, and personal income and spending.
Sources: Seeking Alpha, J.P. Morgan, FACTSET, TD Ameritrade, Stocktwits