The S&P futures are on the move this morning as investors continue to waste their time speculating on the state of a stimulus deal. House Speaker Nancy Pelosi and Edge of Tomorrow producer Steven Mnuchin continue to say that they are close on a deal. However, it’s starting to look more and more like any deal would be dead on arrival. Senate Majority Leader Mitch McConnell has said that the Trump administration shouldn’t agree to a $2 trillion deal. Instead, the Senate is busy trying to pass a $500 billion, more targeted deal, in the Senate today.
Let’s take a look at the numbers from Tuesday.
The Rundown: Today’s Top Market Stories
- This morning, we’re seeing a wave of pressure across Washington D.C. on the next round of stimulus. As I’ve said, stimulus is necessary, and not just to help support the stock market. The longer this delay goes, the longer the recovery is going to take. It appears that Federal Reserve Governor Lael Brainard agrees with that sentiment. This morning, Brianard said that stimulus must come to address a “highly uneven” economic recovery in the year ahead. We’re going to continue to see a K-shaped recovery.
- Finally, Bitcoin has surged today. Paypal (PYPL) said that it will allow users to buy and sell cryptocurrencies on Wednesday and will allow users to use crypto to buy things in early 2021. But that still doesn’t justify the price rise. Nevertheless, this is great news for hackers who continue to extort small businesses across America and demand Bitcoin. They can now buy all their favorite new office furniture on eBay.
This morning, the key COVID story is out of Switzerland. UBS (UBS) said today that the largest threat to the U.S. economy and its success is NOT THE election in two weeks. Instead – it’s the risk of new shutdowns due to any uptick in new cases. Dr. Scott Gotlieb has predicted that the U.S. is two weeks away from a very large surge in new cases. UBS says that new lockdowns that last a few weeks could drive U.S. GDP back into negative territory.
Today’s Top Stocks to Watch: SNAP, TSLA
SNAP: The social media giant Snap Inc. enjoyed a 32% pop after the company shattered earnings expectations. The company did something that I never thought was ever going to be possible since I dragged it through the mud in 2017: It reported a profit. The news pushed shares of Alphabet (GOOGL), Facebook (FB), and Twitter (TWTR) higher. The company also received a positive report from Deutsche Bank suggesting that online advertising in the era of COVID continues to grow at a breakneck pace.
TSLA: Tesla is in focus as the firm prepares to report earnings after the bell. Pay close attention to the company’s growth levels in California. A recent report by Cross-Sell said that Tesla’s third-quarter deliveries hit a new record at 139,900. However, the firm said that registrations were off 13% compared to last year in California, which is Tesla’s largest market. The firm saw a large decline in Model 3 registrations. The report could indicate that Tesla is on the verge of hitting market saturation in California.
SLAK: Finally, I’m keeping an eye on Slack Technologies. Why? Because I’m worried about it. Morgan Stanley just downgraded the stock – despite it being a “Work from Home” darling over the last few months. The investment bank said that the firm is struggling to differentiate itself from its competitors. That’s good news for Microsoft Corporation (MSFT). However, if Slack can’t make money during this critical time for the U.S. economy… when is it going to be successful?