John Hancock: Weekly Market Recap Week Ended October 30th
The major U.S. stock indexes fell for the second month in a row, a reversal from the five consecutive monthly gains in the April to August period. For October, the Dow dropped nearly 5%, the S&P 500 fell nearly 3%, and the NASDAQ lost around 2%.
The U.S. economy went a long way to dig itself out of the hole from its steep decline in the second quarter, when the coronavirus outbreak grew into a pandemic. The government estimated that the economy grew at an annualized rate of 33.1% in the third quarter, compared with a 31.4% drop in the previous three months.
With quarterly earnings in from nearly two-thirds of the companies in the S&P 500, the number of firms that had beaten expectations was at or near a record level as of Friday. According to FactSet, 86% of the companies that had reported third-quarter results exceeded analysts’ earnings-per-share forecasts, compared with an average of 73% over the previous five-year period.
Investors will have no shortage of news to track in the new week, starting with Tuesday’s U.S. election. On Thursday, the U.S. Federal Reserve is expected to keep interest rates unchanged when it concludes a two-day policy meeting, and Friday will bring a closely watched monthly report on jobs and unemployment.