October 22, 2020
The U.S. equity markets bounced around the flatline most of the day yesterday, watching for signs of progress in the coronavirus aid package negotiations as well as several corporate earnings reports. All three major stock indices finished the day lower, with the Dow and S&P 500 dropping 97.97 and 7.56 points, or -0.35% and -0.22%, Respectively. The NASDAQ lost 31.80 points, or -0.28&.
Andrew Simmon, a portfolio manager from Morgan Stanley, believes that investors are so concerned with the results of the election that they are missing signs of economic strength. “There are a lot of signals showing that the economy is breaking to the upside,” said Simmon, noting the U.S. yield curve is steepening, copper prices are soaring, consumer discretionary stocks outperforming consumer staples and strong gains in small cap names.”
“People are focused on the elections; they’re focused on the stimulus, but there are so many confirming signals that the economy is truly recovering, said Simmon. “That’s what the market is telling me.”