US stocks continued to rally on hopes of a new fiscal stimulus deal and a clear presidential election winner posting their best week in three months. The S&P 500 jumped 3.9% and the Dow rose 3.3% for the week. Abroad, the FTSE All World Ex US was climbed 3.3% for the week. The yield on the 10-year Treasury rose over the week to settle at 0.79%. It’s highest level since early June. Oil also posted a large gain for the week rising 9.6% to finish at $40.60 a barrel.
ISM’s non-manufacturing index – a measure of service businesses rose in September in the US while a resurgence of the virus hurt the rebound in Europe and parts of Asia.
Meeting minutes from the Fed’s September meeting show the group was divided over how to communicate its new policy of allowing inflation to rise above 2% in order to target an average inflation level.
After saying negotiations were off until after the election the President reversed course and advocated for a stimulus agreement.
Weekly new unemployment claims fell to 840,000, but still remain elevated and were higher than expected.
Analysts expect S&P 500 firms to report a median drop of 20% in earnings per share for the third quarter. However, that is an improvement over the estimates made at the beginning of the quarter.