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Wall Street Drifts Higher at Open as Election Looms Large; Dow up 60 Pts

Stock MarketsOct 23, 2020 09:48AM ET
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© Reuters.

By Geoffrey Smith 

Investing.com -- U.S. stock markets opened modestly higher on Friday, after the final presidential debate of the election season did little to change the big picture or force many people into rethinking how they want to trade the elections on November 3.

President Donald Trump's more reserved and polite approach in Thursday's debate failed to make a meaningful impact on undecided voters, according to snap polls after the debate, although it did allow him to score his points more effectively when attacking the record and policies of his Democratic opponent, Joe Biden. As such, prediction markets and polls still point to a Biden victory a week on Tuesday, with the odds still on the Democrats taking back the Senate in a 'Blue Wave'. That scenario has underpinned some bullish bets this week, with many prepared to bet on a major stimulus package in the new year, skewed towards poorer consumers and towards a transition to cleaner energy.

By 9:40 AM ET (1340 GMT), the Dow Jones Industrial Average was up 62 points, or 0.2%, at 28,426 points. The S&P 500 was also up 0.2%, while the NASDAQ Composite was underperforming with a 0.2% decline. That was due chiefly to Intel (NASDAQ:INTC) stock, which fell over 10% to its lowest in more than two months after releasing disappointing results on Thursday evening.

Heading in the opposite direction was Mattel (NASDAQ:MAT) stock, which rose 10.7% to its highest in eight months after its results showed a surge in demand for Barbie dolls and related accessories due to parents' need to keep housebound children entertained.

Gilead Sciences (NASDAQ:GILD) stock also rose 3.4% after the Food and Drug Administration authorized its antiviral drug remdesivir for the treatment of Covid-19, the first drug to get the FDA's full seal of approval.

Goldman Sachs (NYSE:GS) stock rose 0.8%, showing no lasting ill effects of the $5 billion settlement it will have to pay for its involvement in the Malaysian 1MDB embezzlement scandal. Analysts noted that the New York-based parent had been able to avoid pleading guilty to a felony, thus protecting relationships with many clients whose statutes forbid them from doing business with convicted entitities.

The broader market remains restrained by the continued lack of agreement on a stimulus package - White House advisor Lawrence Kudlow said earlier Friday he doubted a deal could be struck in time for it to be passed before the election - and by the continued spread of the Covid-19 virus, whose progress through the U.S. is making fresh Europe-style restrictions on activity increasingly likely. A rising proportion of positive tests and increased hospital admissions both contradict claims by the administration that the sharp recent rise in new infections is due to increased testing.

"The trend in the test positivity rate hit bottom earlier this month, at about 4¼%, but it has since risen steadily to about 5½%, and it shows no sign of peaking," said Ian Shepherdson, chief economist of Pantheon Macroeconomics in a note to clients. 

Wall Street Drifts Higher at Open as Election Looms Large; Dow up 60 Pts
 

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Comments (6)
Bill Hoerter
Bill Hoerter Oct 23, 2020 2:17PM ET
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Media's acceptance of Bidens "business" as seemingly normal, should be resented by every American. To solicit monetary payment for any elected office to gain political access should be outlawed.
Plopseven Schwartz
Plopseven Schwartz Oct 23, 2020 2:17PM ET
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You know who the *current* president is, right?
Matt Kay
Matt Kay Oct 23, 2020 11:35AM ET
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How trade the election? Sell strangles. Everything is priced in.
Plopseven Schwartz
Plopseven Schwartz Oct 23, 2020 11:35AM ET
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Go long on volatility
Matt Kay
Matt Kay Oct 23, 2020 11:35AM ET
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Plopseven Schwartz  Im short vol. Only reason vol is high right now is due to uncertainty of election and the beer virus. After election vol will shrink bringing in that sweet premium
Robert Cox
Robert Cox Oct 23, 2020 11:35AM ET
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Election will see volatility rise. It is unlikely Trump will cede the race if he loses. Also, Senate may stay Republican while other two are Democrat.
Matt Kay
Matt Kay Oct 23, 2020 11:35AM ET
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Robert Cox  Agreed, vol will increase, perhaps, day before the election and remain high for a day or two. Or at least that is my guess.
Thom Miller
Thom Miller Oct 23, 2020 11:09AM ET
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This just in from Fox News....Mitch McConnell is seriously ill with an undisclosed blood disease. His chances for re-election now in doubt.
Stephane CHANDELIER
Stephane CHANDELIER Oct 23, 2020 10:26AM ET
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Well 60 points is higher .. but how many is it now ?
Joel Antonio Espinosa Barrios
Joel Antonio Espinosa Barrios Oct 23, 2020 10:11AM ET
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HAHAHAHA Drifts higher!! xD what a JOKE!
Jacob Steinschlag
Jacob Steinschlag Oct 23, 2020 10:02AM ET
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drifts higher? do you have eyes?!
 
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