U.S. Stocks Slip Ahead of First Trump-Biden Debate
By Anna Hirtenstein and Karen Langley
U.S. stocks pulled back Tuesday after two sessions of solid
gains as investors looked ahead to the first debate between
President Trump and former Vice President Joe Biden.
The S&P 500 slipped 0.1%, while the Dow Jones Industrial
Average edged down 0.1%, or about 30 points. The tech-heavy Nasdaq
Composite hovered around the flatline.
Heading into the end of a turbulent September, major indexes
edged up Thursday and then notched big gains Friday and Monday. The
S&P 500 is up 3.6% in 2020 but down 4.4% for the month.
After stocks rocketed higher from their March lows, many
investors predicted they could be due for a pullback.
"It's just the way markets work," said Vance Howard, chief
executive and portfolio manager at Howard Capital Management. "It's
kind of like a marathon runner. A marathon runner can only run so
far and so fast without having to sit down and take a break. That
doesn't mean anything is wrong with them."
Market volatility is on the rise as the November U.S. election
gets closer. Mr. Trump and Mr. Biden will face off at 9 p.m. ET in
Cleveland, Ohio, to discuss their respective records, the
coronavirus pandemic, the economy, race and violence. Other issues
are likely to be their views on mail-in voting, interference by
overseas interests and potential election fraud.
"People will read into this debate for answers to questions
about whether the results of the election will be accepted by
either side," said Tony Dalwood, chief executive of Gresham House
Asset Management. "If there's any uncertainty around this, that
will lead to volatility."
Investors are also continuing to assess the now-dimming
prospects for new additional spending to support the economy. House
Democrats released a $2.2 trillion-bill for a coronavirus-relief
package on Monday evening. House Speaker Nancy Pelosi spoke with
Treasury Secretary Steven Mnuchin on Tuesday morning, aiming to
revive stalled negotiations.
But the focus in Congress has turned to the selection of a new
Supreme Court justice, analysts said.
"A combination of the situation with the Supreme Court, and
Democrats being unwilling to hand Trump a major fiscal stimulus
just before the election, makes it quite unlikely that we'll see
something passed," said Sebastian Mackay, a multiasset fund manager
Sectors that led the S&P 500 higher Monday reversed course
Tuesday, with the financials group dropping 0.8% and the energy
group falling 2.6%. U.S. crude lost 3.2%, to $39.29 a barrel, and
is down 36% this year.
Investors are continuing to monitor the spread of coronavirus.
New cases in the U.S. edged down, while the global death toll from
the pandemic surpassed one million.
Among individual stocks, shares of Abbott Laboratories rose 1.1%
after Mr. Trump said 150 million rapid coronavirus tests from the
pharmaceutical company would be shipped across the U.S.
Inovio Pharmaceuticals shares dropped 5.6% after a planned
later-stage trial for a Covid-19 vaccine was put on hold, following
questions from U.S. health regulators. The shares tumbled 28%
Overseas, the pan-continental Stoxx Europe 600 declined 0.5% as
coronavirus cases continued to rise, raising the risk of more
stringent measures being introduced by governments in the
In Asia, major stock benchmarks were mixed by the close of
trading. The Shanghai Composite Index advanced 0.2% and Hong Kong's
Hang Seng Index slipped 0.9%.
In bond markets, the yield on the 10-year Treasury fell to
0.650%, from 0.661% on Monday. Yields fall as bond prices rise.
Write to Anna Hirtenstein at email@example.com and Karen
Langley at firstname.lastname@example.org
(END) Dow Jones Newswires
September 29, 2020 15:40 ET (19:40 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.