Major Indexes Log Shaky Week Amid Surging COVID-19 Cases

Still, surging coronavirus cases are keeping optimism in check

Assistant Editor
Nov 20, 2020 at 1:46 PM
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The main culprit of this week's tumultuous price action was rising COVID-19 cases, occasionally offset by optimism surrounding the vaccine updates that poured in. To start, Monday saw the major indexes log big wins, with the Dow and S&P 500 notching record closes. By Tuesday, however, stocks took a step backwards, falling victim to profit-taking as investors reacted to the massive spike in coronavirus cases.

Meanwhile, Wednesday saw the blue-chip log its second-straight day of triple digit losses, as Wall Street mulled over the aforementioned vaccine developments. Then, despite the U.S. pandemic death toll topping 250,000, the markets rose, albeit only slightly. But things looked down on Friday, as hopes of a smooth economic recovery were dashed, and states began implementing varying levels of lockdowns. Investors also eyed the the push end a portion of the Federal Reserve's emergency credit funding programs.

Retail Earnings Continue to Pour In

There was no shortage of earnings, as well. One of the more notable reports to drop was from blue-chip mega retailer Walmart (WMT), which reported a quarterly beat and optimism surrounding the upcoming holiday season. Another notable company to top Wall Street's estimates was Home Depot (HD). Meanwhile, La-Z-Boy (LZB) outmatched analyst expectations, and reinstated its dividend. Lastly, Victoria's Secret's parent company reported better-than-expected revenue and earnings, resulting in a plethora of price-target hikes.

 

Vaccine Updates Continue, Help More than Pharma Stocks

Even more coronavirus-related vaccine news rolled in this week. Former frontrunner, Moderna (MRNA) announced its vaccine candidate has an efficacy rate of over 94%. Meanwhile, Pfizer (PFE) and BioNTech (BNTX) provided the final update for their vaccine candidate, and said it would seek U.S. Food and Drug Administration (FDA) approval within days. Toward the end of the week, AstraZeneca (AZN) announced their vaccine candidate, which they developed with Oxford University, is safe and produced a strong immune response in older adults. While pharmaceutical stocks are the most obvious to benefit from the news, at least one airline stock saw a huge bump as well.

Best 25 Stocks to Buy Thanksgiving Week

Even though Wall Street is heading toward a holiday-shortened week, there's still plenty for investors to look forward to, including more retail earnings. Monday features a plethora of data, while Tuesday follows up with the Case-Shiller national price index. Wednesday is where the bulk of this week's data will surface, including employment, durable goods orders, new home sales, and consumer. Meanwhile, Schaeffer's Senior Quantitative Analyst Rocky White has a list of stocks to watch during the upcoming Thanksgiving week.

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