Stocks Log Tumultuous Start to October

Shocking news closed the week out

Deputy Editor
Oct 2, 2020 at 3:12 PM
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Stocks began the week with wins, though by Wednesday, the major indexes all finished with monthly losses -- their first since March. On Monday, a rally in Big Tech and optimism concerning additional U.S. fiscal stimulus helped the major averages to big wins. Things took a turn for the worse on Tuesday, with the major indexes logging their first losses in four days after New York City saw another outbreak in COVID-19 cases. Stocks kicked off the new month and quarter with small gains, as all three notched daily wins on Thursday while uncertainty surrounding additional U.S. fiscal stimulus kept a lid on gains. The optimism looked like it might carry over to Friday, but U.S. President Donald Trump made a shocking announcement that he and First Lady Melania Trump had tested positive for the coronavirus, resulting in early losses.

Massive Layoffs Dominate Headlines

While Trump's contraction of the virus threw investors off, its come as no surprise that certain industries are still reeling from the pandemic. For one, Walt Disney (DIS) announced it would layoff around 28,000 employees, mostly at its U.S. theme parks. Allstate (ALL) announced it would cut jobs as well, nearly 8% of its workforce, in fact, across its claims, sales, service, and support functions.

Meanwhile, this petroleum company said it would cut 12% of its staff because of the pandemic, while a bear note also rolled in for the stock. While layoffs were the talk of the town, at least Duke Energy (DUK) got a boost on some takeover buzz.

Earnings and Best, Worst Stocks to Own in October

More earnings poured in, with United Natural Foods (UNFI) stock surging in particular after the food wholesaler reported fiscal fourth-quarter profits that shattered Wall Street's expectations. Meanwhile, IHS Markit (INFO) stock was flat after beating analysts' estimates, but failing to deliver on revenue. Lastly on the earnings front, this beverage behemoth sunk despite the equity coming through on both earnings and revenue. 

In addition to earnings, we took a look at the best and the worst stocks to own, historically, in the month of October. 

More Earnings, Economic Data Coming Up

With September in the rearview, there will be a temporary respite from the onslaught of earnings and economic data. Concerning the latter, the Fed's meeting minutes are set to be released on Wednesday. Before that, however, there will be manufacturing data to go over, as well as some jobs data. The latter part of the week will feature the always newsworthy jobless claims data, and end with the United States Department of Agriculture's latest monthly forecast. In terms of earnings, Delta Air Lines (DAL), Domino's Pizza (DPZ) and Levi Strauss (LEVI) are just a few of the notable names set to report.

For now, take a look at what Schaeffer's Senior Quantitative Analyst Rocky White forecasts to come in the fourth quarter


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