The S&P 500 dipped in a volatile week of trading as investors digested record numbers of daily U.S. COVID-19 cases, an uptick in geopolitical tensions and a new round of polls suggesting Democrats are gaining momentum ahead of the November election.
On Monday, President Donald Trump assured investors that January’s phase one U.S. trade deal with China is “fully intact” despite concerns surrounding China’s handling of the COVID-19 outbreak. In addition to rising tensions with China, the United States Trade Representative said last week that the USTR is considering a new round of tariffs on $3.1 billion in European exports from France, Germany, Spain and the U.K.
On Wednesday, the U.S. had 45,000 new coronavirus cases, the highest daily total of the year. Stocks traded lower Thursday due to concerns a resurgence in COVID-19 infections could negatively impact the economy and even trigger more shutdowns.
A new poll from The New York Times and Siena College on Wednesday found former vice president and presumptive Democratic nominee Joe Biden leading Trump by a 14% margin, and NBC News reported Thursday that Trump’s polling deficit is larger than any incumbent since George H.W. Bush in 1992. Biden has said he would seek to raise the U.S. corporate tax rate from 21% to 28%, which could potentially eat into profits and weigh on stock prices.
U.S. bank stocks got a boost Thursday after the Federal Deposit Insurance Commission said it intends to ease the so-called Volcker Rule, which restricts banks from making large investments into venture capital. The Volcker Rule was enacted in the wake of the 2008 financial crisis, and the new changes could potentially free up billions in bank capital.
The banks were also in focus at the Federal Reserve, who said in their annual stress test that the biggest banks are well-capitalized to get through the crisis — but that could change if the economy does not soon recover.
“If you think about it, if we’ve seen the worst behind us in March and April, then the banks are going to be just fine moving forward,” said Shawn Cruz, manager of trader strategy at TD Ameritrade Holding Corp. AMTD.
Earnings In Focus: Shares of drugstore chain Rite Aid Corporation RAD gained more than 30% after the company reported first-quarter earnings and revenue numbers that exceeded analyst expectations.
This week, investors will turn their attention to earnings reports from
Micron Technology, Inc. MU on Monday, FedEx Corporation FDX on Tuesday and General Mills, Inc. GIS and
Macy's Inc M on Wednesday.
Analysts are expecting second-quarter S&P 500 revenue to fall 11.2%, according to FactSet.
Economic Numbers: On Tuesday, Federal Reserve Chair Jerome Powell and Treasury Secretary Steven Mnuchin will testify in front of Congress ahead of Friday’s June jobs report from the Labor Department.
Benzinga file photo by Dustin Blitchok.
© 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Ad Disclosure: The rate information is obtained by Bankrate from the listed institutions. Bankrate cannot guaranty the accuracy or availability of any rates shown above. Institutions may have different rates on their own websites than those posted on Bankrate.com. The listings that appear on this page are from companies from which this website receives compensation, which may impact how, where, and in what order products appear. This table does not include all companies or all available products.
All rates are subject to change without notice and may vary depending on location. These quotes are from banks, thrifts, and credit unions, some of whom have paid for a link to their own Web site where you can find additional information. Those with a paid link are our Advertisers. Those without a paid link are listings we obtain to improve the consumer shopping experience and are not Advertisers. To receive the Bankrate.com rate from an Advertiser, please identify yourself as a Bankrate customer. Bank and thrift deposits are insured by the Federal Deposit Insurance Corp. Credit union deposits are insured by the National Credit Union Administration.
Consumer Satisfaction: Bankrate attempts to verify the accuracy and availability of its Advertisers' terms through its quality assurance process and requires Advertisers to agree to our Terms and Conditions and to adhere to our Quality Control Program. If you believe that you have received an inaccurate quote or are otherwise not satisfied with the services provided to you by the institution you choose, please click here.
Rate collection and criteria: Click here for more information on rate collection and criteria.