DJ Stocks Are Slipping Along With Stimulus Hopes. Boeing and Nikola Advance. -- Barrons.com
By Teresa Rivas
Stocks are slipping at midday Monday. A light day for earnings meant investors could nervously focus on diminishing hopes for another imminent stimulus package.
The Dow Jones Industrial Average is off 0.3%, while the S&P 500 and the Nasdaq Composite are falling 0.4%.
Stocks had been rising to start the week, as investors had "renewed hopes for a stimulus bill, fueled by an accelerated rise in new [virus] cases, which in a backwards sort of way translates into a positive for the market," notes Chris Larkin, a managing director at E*Trade Financial. "This is a packed week for earnings, which will help paint a clearer picture of how our economy is faring throughout the pandemic, while also delivering near-term opportunities for traders."
However, Monday's earnings docket is relatively empty, which means that investors have fewer distractions from the gridlock in Washington.
"Politics obviously looms large and the hint of a savings surplus among consumers...to cushion near-term spending has given Congress an excuse to drag its feet," notes Morgan Stanley Wealth Management Chief Investment Officer Lisa Shalett. She notes that some experts put the odds of a stimulus deal before January at less than 20%. With $1 trillion separating the Democrats' and Republican's proposals, "the size of the bill may hinge on the outcome of Senate races," further complicating matters for investors trying to handicap the outcome today.
Among individual stocks, Boeing (ticker: BA) is up 1.1% as its 737 Max aircraft appears close to returning to service.
Nikola (NKLA) is up 4.7% as investors parse what the battery and fuel-cell firm's prospects would look like with or without a General Motors (GM) deal.
O'Reilly Automotive (ORLY) is up 0.4% following an upgrade from Raymond James that says the stock is trading too cheaply.
Write to Teresa Rivas at teresa.rivas@barrons.com
(END) Dow Jones Newswires
October 19, 2020 12:22 ET (16:22 GMT)
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