President Donald Trump makes a campaign stop at Miami-Opa Locka Executive Airport on Nov. 1.
Joe Raedle/Getty ImagesIt’s a typical Wall Street Monday as traders take their seats in front of their screens—even if it doesn’t feel like one.
There’s a massive amount of news coming. The election is the big one, but there’s a Fed meeting ending on Thursday, payrolls on Friday, and 130 S&P 500 companies set to report earnings. The continued rise in Covid-19 cases hangs over everything.
Stocks, however, are rebounding from last week’s selloff. S&P 500 futures are up 1.8% Monday morning.
Perhaps the market is feeling more confident about the election outcome Tuesday, though the betting markets are giving Joe Biden a 65% of a win, relatively unchanged in recent weeks.
Deals may be moving stocks, too. Nielsen shares are up about 10% after the company announced it is selling its retail tracking business to a private-equity firm for $2.7 billion.
Or maybe it’s just a typical Monday. The S&P 500 has moved 1% or more in either direction every Monday since the end of August
That’s a lot of volatility—and it hasn’t been good for the market. The S&P 500 has dropped 6.6% since the end of August.
It’s a reminder that uncertainty usually isn’t good for the market—even when it seems otherwise.
—Al Root
*** Barron’s senior managing editor Lauren R. Rublin, deputy editor Ben Levisohn and a special guest discuss what to watch in markets this week today at 12 p.m. Eastern time. Sign up here.
***
Biden Holds Lead Over Trump, but Democrats Remain Anxious
Former Vice President Joe Biden holds a steady lead over President Donald Trump in national polls released this weekend. The outcome is far from certain, however, as Biden’s lead in key, battleground states appears to have narrowed.
- The final Wall Street Journal/NBC News poll before Election Day found that Biden leads Trump by 52% to 42%. That result is similar to the Real Clear Politics average of national polls, which has Biden leading Trump by a margin of 51.1% to 43.9%.
- In battleground states, the WSJ/NBC poll found Biden with a slimmer lead. He is up by 6 percentage points, down from a 10-point lead in October. The Real Clear Politics average of swing states gives Biden a 3.4 percentage point lead.
- A New York Times poll shows Biden ahead in four states Trump won in 2016—up 6 points in Arizona, 3 points in Florida, 6 points in Pennsylvania, and 11 points in Wisconsin. A Washington Post/ABC poll found Biden up 7 points in Pennsylvania and Trump up 2 points in Florida.
- According to the final WSJ/NBC News polls, just 6% of voters have yet to make up their minds, far fewer than the 16% who had yet to decide in the final 2016 poll.
- Nonetheless, Democrats remain anxious because of Trump’s come-from-behind victory four years ago and concerns about legal challenges to the election results.
What’s Next: Biden will campaign in Ohio Monday before crisscrossing Pennsylvania on Tuesday. President Trump will visit North Carolina, Michigan, Pennsylvania, and Wisconsin on Monday with his Election Day travels still to be set.
—Ben Walsh
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Election Day Nears but Results Could Be Delayed
With historically high voter turnout and a wide expansion of mail-in and early voting, some states are warning it will take much longer than usual to know the winner after Election Day.
- It may take until Friday for most votes to be counted in Pennsylvania, where there is “a volume of vote-by-mail that we never would have imagined in a million years,” Pennsylvania’s top election official, Kathy Boockvar, said. State law prohibits ballots to be counted before Election Day.
- While Wisconsin doesn’t begin counting until Election Day, its governor said he expects the state to have a result on Tuesday night or early Wednesday. Other key states, like Arizona, Florida, and North Carolina, allow either vote-counting itself or at least sorting and ballot opening to begin before Nov. 3.
- Democrats are more likely to vote by mail, which could lead to a so-called “red mirage” on Nov. 3, where Republican prospects look far more promising than they ultimately turn out once all votes are counted. President Trump is reportedly considering declaring victory in such a scenario.
- There’s also a chance that the election might be called Tuesday night. This would happen if one candidate takes several early-counting battleground states like Arizona, Florida, and North Carolina while having a wide-lead in Wisconsin.
- If the election is particularly close, however, the result could come down to days of vote counting and possible lawsuits disputing the vote counting process in Pennsylvania.
What’s Next: States typically don’t finish counting all the votes cast on election night and there is no legal requirement that they must. However, Trump has signaled that he may claim election fraud if mail-in ballots are counted, as they legally can be, after Nov. 3.
—Ben Walsh
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Europe Challenged by Economic Cost of New Restrictions
The U.K. this week joins Germany and France in the club of countries forced into national lockdowns by rising coronavirus cases. With their fiscal and monetary power depleted in the spring by the initial wave of infections, the focus of policy makers is now turning to the Covid-19 resurgence’s economic price.
- The Bank of England will meet Thursday amid expectations that it will increase its asset buying program, which would help the government devote more fiscal resources to counter the economic consequences of the new restrictions. That’s after the ECB indicated last week that it will take new measures in December.
- Rishi Sunak, the U.K.’s finance chief, said Saturday that the U.K. government would extend a furlough scheme of job subsidies due to expire at the end of October until the end of the year, to help companies weather the new lockdown, which involves the closure of all “non essential” retail businesses.
- The Italian government is reported to be considering a 9 p.m. national curfew and a ban on inter regional travel. The country’s health minister said Sunday new data about the spread of the disease was “terrifying,” and that new restrictions would have to be taken “within 48 hours.”
- Goldman Sachs Monday slashed its economist forecast for Europe. The bank’s analysts now expect eurozone GDP to shrink 2.3% in the last quarter of the year, compared to their previous prediction of a 2.2% expansion.
What’s Next: Europe seems to gradually veer toward overt financing of budget deficits by central banks, denials notwithstanding. That’s because governments are starting to worry about the public debt load, and lowering interest rates could be of little interest for businesses who are not rushing to take on more leverage.
—Pierre Briançon
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France’s Version of Lockdown Could Turn into Bonanza for Amazon
The French government’s decision to ban supermarkets and big retailers from selling goods deemed “non essential” could amount to a blank check for Amazon.com, which already enjoyed success in the country in spite of still being much-maligned.
- The lockdown originally announced by French President Emmanuel Macron last week included the closure of all bookstores, whereas big retailer chains were allowed to keep selling books.
- After an uproar, the French governments decided to ban retailers from selling books and other cultural goods such as CDs or DVDs.
- It then extended the ban, and supermarkets will now be banned from selling items such as clothes, shoes, beauty products, toys, jewels or household equipment, because small independent specialist stores will be forced to close.
- Online retailers are not included in the restrictions, which mean that Amazon is now expected to become the main beneficiary of the measures even though the government set aside €100 million to help small businesses set up online sites.
- Amazon agreed to suspend its French advertising campaign for its “Black Friday” sales, due November 27, on request from French Junior Economy Minister Agnes Pannier-Runchaer, who said the campaign was “not at all appropriate.”
What’s Next: The hesitations and u-turns of the French government illustrate the sometimes arbitrary and improvised character of lockdown measures, which are bound to hit businesses differently depending on their size. Expect more French calls to press ahead with a global digital tax on internet giants.
—Pierre Briançon
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Stocks to Buy No Matter Who Wins the Election
Barron’s Liz Moyer found five stocks that should rise regardless of who wins the presidential election by looking at “key trends that appear to be election-proof, thus offering patient investors some long-term opportunities.” Here’s her thinking behind each pick.
- Abbott Laboratories stands to benefit from the ongoing need for a significant increase in the U.S.’s coronavirus testing capacity. The company’s $5 rapid Covid-19 test delivers results in 15 minutes and should benefit from federal and state spending on testing, especially after a second round of stimulus gets passed.
- Gold mining company Newmont represents a bet that, regardless of who comes out on top, the global economic system will remain turbulent, and central banks will keep rates near zero for the foreseeable future. The company’s third-quarter revenue rose 17% compared to the same period last year.
- SBA Communications is a real-estate investment trust that operates nearly 33,000 cellphone towers in North and South America. It’s primed to benefit from the rollout of 5G phones as more people rely on wireless technology.
- Roper Technologies is a lesser-known company that makes electronic tolling systems and is working to design a congestion-pricing system for New York City. It also makes video intubation equipment used to help treat Covid-19 patients. It has beaten earnings expectations for four straight quarters and has impressive free cash flow.
- Lastly, there’s Carlisle, which makes roofing materials, a generally booming business that saw a dip in the spring as construction briefly slowed due to infection concerns.
What’s Next: While there are huge needs for government spending in areas like Covid-19 testing and infrastructure, it’s unclear how soon, if at all, money will flow into those industries after the election.
—Ben Walsh
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MarketWatch Wants to Hear From You
The CDC has given the green light for a phased reopening of the cruise industry. What does that mean for travelers planning future cruise vacations and their safety?
A MarketWatch correspondent will answer this question on Thursday. In the meantime, send any questions you would like answered to thebarronsdaily@barrons.com.
***
—Newsletter edited by Anita Hamilton, Stacy Ozol, Ben Levisohn and Matt Bemer
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