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Stock Market News for Nov 6, 2020

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Zacks Equity Research
·5 min read
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U.S. stock markets closed sharply higher on Thursday as the wait for the U.S. Presidential election outcome continues. Moreover, several better-than-expected earnings data kept investors’ sentiment buoyed. All three major stock indexes ended the day in green.

How Did The Benchmarks Perform?

The Dow Jones Industrial Average (DJI) rallied 2%, or 542.52 points, closing at 28,390.18 continuing its 4-day winning streak. Notably, 28 components of the 30-stock index ended in green while 2 finished the day in red. The blue-chip index is 0.5% below to become green year to date. The tech-heavy Nasdaq Composite closed the day at 11,890.93, up 2.6% or 300.15 points, marking fourth successive day of gains, backed by strong performance from large-cap technology stocks.

Meanwhile, the S&P 500 gained 2%, closing the day at 3,510.45, maintaining 4-day winning run. The Materials Select Sector SPDR (XLB) and the Technology Select Sector SPDR (XLK) popped 4.1% and 3.1%, respectively. Notably, ten out of eleven sectors of the benchmark index closed in the positive zone and one unchanged.

The fear-gauge CBOE Volatility Index (VIX) was down 6.7% to 27.58. A total of 10.42 billion shares were traded on Thursday, higher than the last 20-session average of 9.16 billion. Advancers outnumbered decliners on the NYSE by a 4.6-to-1 ratio. On Nasdaq, a 3.2-to-1 ratio favored advancing issues.

Wall Street Waits for The Presidential Election Outcome

Wall Street closed Thursday on a positive note amid the continued wait for the outcome of the presidential election. Investors monitored the election results as the outcome will determine the course of policy measures and more fiscal relief for boosting the economy.

The winner for the race of White House as well as the election outcome of the shape of the U.S. Congress, both the Senate and the House of Representatives, will determine several key economic issues and financial policy variables. This include the decision regarding a fresh fiscal stimulus, government's tariff policies, especially with China, deregulations and tax related issues and geo-political strategies.

Upbeat Earnings

General Motors Co. GM reported adjusted diluted earnings of $2.83 per share in third-quarter 2020, comfortably surpassing the Zacks Consensus Estimate of earnings of $1.47. (Read More)

Expedia Group Inc. EXPE came out with a quarterly loss of $0.22 per share, narrower than the Zacks Consensus Estimate of a loss of $0.92. (Read More)

Cardinal Health, Inc. CAH reported first-quarter fiscal 2021 adjusted earnings of $1.51 per share (EPS), which surpassed the Zacks Consensus Estimate of $1.14 by 32.5%. (Read More)

Consequently, shares of Cardinal Health, General Motors and Expedia rallied 7.3%, 5.3% and 4.7%, respectively. Cardinal Health carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Economic Data

The U.S. Department of Labor reported that initial jobless claims declined by 7,000 to 751,000 for the week-ended Oct 31. The consensus estimate was 736,000 and previous week’s data was revised upward by 7,000 to 758,000 from 751,000 reported earlier.

Continuing claims (people who are already receiving benefits) declined by 538,000 to 7.29 million for the week ended Oct 24 from the prior week which was revised upward by 67,000 to 7.82 million from 7.76 million reported earlier.

The four-week moving average for continuing claims dropped by 827,250 to 8,244,500 from the prior week’s average which was revised upward by 18,500 to 9,071,750 from 9,053,250 reported earlier.

The U.S. Bureau of Labor Statistics reported that the preliminary nonfarm productivity for third-quarter 2020 increased 4.9%. The consensus estimate was a 5.4% gain and the second quarter saw a growth of 10.6% which was revised upward from 10.1% reported earlier.

The Unit Labor Costs decreased 8.9% in the third quarter. The consensus estimate was a 10.8% fall. It also compares to a growth of 8.5% in the second quarter which was revised downward from 9% reported earlier.

Domestic vehicle sales for October came in at 12.7 million compared to 12.8 million in September. Total vehicles sales for October was reported at 16.2 million, falling short of the consensus estimate of 16.4 million and compared to 16.3 million in September.

In the FOMC Policy Statement, the U.S. Federal Reserve decided to keep the target range for federal funds rate at 0% to 0.25% and expected to maintain its “accommodative stance” of monetary policy.

Stocks That Have Made Headline

EOG Resources Q3 Earnings Beat Estimates, Revenues Miss

EOG Resources, Inc. EOG reported third-quarter 2020 adjusted earnings per share of $0.43, beating than the Zacks Consensus Estimate of earnings of $0.16. The bottom line, however, deteriorated from the year-ago quarter profit of $1.13 per share. (Read More)

Uber's Q3 Loss Wider Than Expected, Shares Decline

Uber Technologies, Inc. UBER incurred a loss of $0.62 per share in the third quarter of 2020, wider than the Zacks Consensus Estimate of a loss of $0.60. (Read More)

5 Stocks Set to Double

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Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.

Today, See These 5 Potential Home Runs >>


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Expedia Group, Inc. (EXPE) : Free Stock Analysis Report
 
Cardinal Health, Inc. (CAH) : Free Stock Analysis Report
 
EOG Resources, Inc. (EOG) : Free Stock Analysis Report
 
General Motors Company (GM) : Free Stock Analysis Report
 
Uber Technologies, Inc. (UBER) : Free Stock Analysis Report
 
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