Before The Bell
U.S. stocks started off the week with a volatile session, ending the day mixed, but mostly up.
While there were no market moving economic headlines, the coronavirus continues to weigh heavily on investors’ minds. Concerns about still-rising COVID-19 cases, the slow rollout of available vaccines, and the threat of further lockdowns continue to overhang the market. Most recently, Moderna, Inc. (MRNA) said that its vaccine is less effective against the new strains of the virus that have emerged. However, it is developing a booster shot to help against the more aggressive variants. Meanwhile, AstraZeneca (AZN) continues to face supply issues, but Merck (MRK) stopped the development program for its two vaccine candidates due to inferior immune system response. Lastly, Johnson & Johnson (JNJ) plans to release data on their version soon. On top of all this, the lack of progress on the proposed $1.9 trillion stimulus package didn’t do anything to lift investor spirits.
The Dow Jones Industrials ended the session down 37 points. However, the broader S&P 500 moved up by 13 points, to close at a new high, while the tech-heavy NASDAQ also reached a new peak, advancing 92 points. A slight majority of major market sectors were in the green, led by Utilities (up 2%), consumer staples (+0.9%) and health care (+0.7%). On the other side of the ledger, energy shares were down 1.1%, while financials fell 0.8%. Elsewhere oil prices edged higher, with light sweet crude up 1%, to about $52.75 a barrel.
Meanwhile, shares in Europe spent most of the day trending down. Germany’s DAX took the biggest hit, slipping 1.7%. France’s CAC-40 didn’t do much better, falling 1.6%, while the U.K.’s FTSE 100 was down 0.8%.
As we look to the new day, stocks in Asian markets closed mostly down, but the European bourses are all showing solid gains. Meanwhile, U.S. stock futures are pointing to a generally positive open for the indexes. Looking further ahead, earnings season kicks into higher gear with a number of key names reporting this week, including tech heavyweights Apple (AAPL), Facebook (FB), Microsoft (MSFT) and Tesla (TSLA).
– Mario Ferro
At the time of this article's writing, the author had no positions in any of the companies mentioned.
