Daily Market Report | Dec. 31, 2020

U.S. Stocks Waver in Final Trading Day of 2020 – Wall Street Journal, 12/31/20

  • U.S. stocks wobbled early Thursday, signaling a muted finish to a year that saw the major indexes contract sharply in the spring before snapping back to cinch record highs.
  • The tepid end belies a year that saw stocks bounce back since the March rout despite the economic fallout of the coronavirus pandemic.
  • The unprecedented steps taken by major central banks to bolster credit flow and the increase in governments’ spending encouraged investors to focus on growth opportunities despite the economic havoc.
  • That helped the three major indexes notch 100 record closes so far in 2020, with the Dow hitting its 13th all time finishing high of the year on Wednesday.
  • Fresh data on Thursday showed that 787,000 Americans applied for unemployment benefits for the first time through the week ended Dec. 26, down from 806,000 in the week prior.
  • Money managers are hoping that the widespread rollout of vaccines will allow for the resumption of normal social and business activity, helping accelerate the economic rebound next year.
  • Central banks and governments are also widely expected to continue providing additional support to the economy.

Coronavirus Live Updates: U.S. Covid-19 Hospitalizations Top 125,000 for the First Time – Wall Street Journal, 12/31/20

  • Hospitalizations in the U.S. due to Covid-19 surpassed 125,000 for the first time, as more cases of a fast-spreading variant of the virus emerged in parts of the country.
  • Intensive-care units were also under strain, with 23,069 patients in ICUs.
  • The U.S. reported more than 220,000 new coronavirus cases for Wednesday, according to data compiled by Johns Hopkins University. The nation reported more than 3,700 deaths from Covid-19 for Wednesday, a single-day record, as the total exceeded 342,000, according to Johns Hopkins data.
  • In California, Gov. Gavin Newsom confirmed that the new, fast-spreading variant of Covid-19 that initially surfaced in the U.K. has arrived in Southern California. Officials in Colorado on Wednesday said a possible second case of the variant had been identified in that state.
  • The U.K. ended the year with record numbers of people hospitalized with Covid-19 as a new variant of the virus continued to spread rapidly around the country.
  • The British government placed more areas of the country under the strictest lockdown, leaving a large majority of Britons under stay-at-home instructions.
  • The latest data showed the highest number of cases ever recorded on one day at over 50,000, with 981 Covid-related deaths reported Wednesday.
  • Some 23,771 people were in the hospital with Covid, above the peak in the first wave on April 12 of 21,683.
  • Germany recorded 32,552 new cases on Wednesday, according to the Robert Koch Institute for infectious diseases, roughly the same as on Thursday last week, and 964 new Covid-19-related deaths, close to the all-time record reached on Tuesday.
  • Central and state government leaders will meet on Jan. 5 to decide over what is widely expected to be an extension of the lockdown beyond its current expiry date of Jan. 1
  • New cases of the coronavirus have been detected in Australia’s Victoria state, the first cases of community transmission in two months. Authorities reported five new local cases on Thursday, following three locally transmitted cases on Wednesday.
  • The state government again tightened restrictions ahead of New Year’s Eve celebrations later in the day, cutting the number of people allowed to gather at home by half, to 15, and making masks mandatory indoors.

U.S. vaccinations in 2020 falling far short of target of 20 million people – Reuters, 12/31/20

  • Only about 2.8 million Americans had received a COVID-19 vaccine going into the last day of December, putting the United States far short of the government’s target to vaccinate 20 million people this month.
  • As late as early December, officials maintained they would have 40 million doses available this month, enough to vaccinate 20 million Americans with a two-dose regimen.
  • Shots are reaching nursing home residents at an even slower pace than others first in line even though they are most at risk of dying of the virus.
  • Only 170,000 people in long-term care facilities received a shot as of Dec. 30 even though 2.2 million doses were distributed for residents, according to data released from the Centers for Disease Control and Prevention.

New York Officials Say Thousands Can Attend Buffalo Bills Playoff Game – Wall Street Journal, 12/31/20

  • More than 6,000 people will be allowed to watch live when the Buffalo Bills compete in a playoff game next weekend at their Erie County stadium, New York state officials said Wednesday.
  • Gov. Andrew Cuomo, a Democrat, and New York State Health Commissioner Howard Zucker said they had reached agreement with the American Football Conference team to allow fans for the first time this season.
  • The team said in a news release that season-ticket holders would get first dibs on securing one of the 6,200 seats.
  • Anyone who wishes to attend would need to pay $63 for a coronavirus PCR test at the stadium and test negative in the three days before the game.

Oil outlook for 2021 hit by new COVID-19 strain: Reuters poll – Reuters, 12/31/20

  • Oil prices are unlikely to mount much of a recovery in 2021 as a new coronavirus variant and related travel restrictions threaten already weakened fuel demand, a Reuters poll showed on Thursday.
  • The poll of 39 economists and analysts conducted in the second half of December forecast Brent crude prices would average $50.67 per barrel next year.
  • That is up from a poll last month that forecast a 2021 average price of $49.35 per barrel but little changed from Brent trading at around $51 on Thursday.
  • West Texas Intermediate (WTI) U.S. crude futures are expected to average $47.45 per barrel in 2021, the poll showed.
  • That too is up from a November consensus of $46.40 per barrel but little changed from Thursday WTI trading near $48.

Amazon Agrees to Buy Podcast Startup Wondery – Wall Street Journal, 12/31/20

  • Amazon.com said it has agreed to acquire podcast producer Wondery, the online retail giant’s latest move to beef up its audio offerings.
  • Amazon didn’t disclose the purchase price, but a person familiar with the matter said it was about $300 million.
  • Founded in 2016, Wondery is one of several audio startups that blossomed in recent years as podcasting caught on with advertisers and listeners.
  • Wondery is known for its gritty, narrative-driven podcasts that apply cinematic sound design to nonfiction stories.

Alden Global Seeks to Buy Tribune Publishing – Wall Street Journal, 12/31/20

  • A hedge fund that owns a big stake in Tribune Publishing is seeking to buy the newspaper chain behind titles including the Chicago Tribune and New York Daily News.
  • Alden Global Capital, which is already Tribune’s largest shareholder with a 32% stake, has expressed interest in acquiring the shares of the publishing company it doesn’t own already for $14.25 a share, according to a filing with the Securities and Exchange Commission. The shares closed Wednesday at $12.79.
  • A deal would have far-reaching implications for an industry beset by sharp declines in revenue over the past 20 years that have led to a wave of consolidation and cost cuts.
  • Between 2008 and 2019, the industry shed 51% of its newsroom jobs, according to the Pew Research Center.

US ECONOMY & POLITICS

U.S. weekly jobless claims fall for second straight week – Reuters, 12/31/20

  • The number of Americans filing first-time claims for unemployment benefits unexpectedly fell for a second straight week last week but remain elevated more than nine months into the health and economic crisis triggered by the coronavirus pandemic, signaling a long recovery for the U.S. job market.
  • Initial claims for state unemployment benefits slid to a seasonally adjusted 787,000 for the week ended Dec. 26, from 806,000 in the prior week, the Labor Department said on Thursday.
  • As of Dec. 19, the number of people continuing to draw benefits under regular state unemployment insurance programs declined to 5.219 million, the lowest since April, from 5.322 million the week before.
  • The report also showed that as of mid-December, more than 19.5 million people were receiving some form of jobless aid, including from emergency measures recently extended by the latest coronavirus aid bill.

Push for Bigger Stimulus Checks Is Running Out of Time – Wall Street Journal, 12/31/20

  • The prospect of the Senate quickly approving $2,000 stimulus checks dimmed further, with the chamber focused on overriding President Trump’s veto of the annual defense-policy bill before the end of the session and Republican leaders brushing aside Democratic demands for a stand-alone vote on the larger payments.
  • On Wednesday, Senate Majority Leader Mitch McConnell (R., Ky.) blocked a vote on the checks, the second time he has objected to Senate Minority Leader Chuck Schumer’s (D., N.Y.) requests to vote on the House bill.
  • Instead, he introduced legislation that joins the increased checks with other demands from Mr. Trump that lack bipartisan backing: eliminating Section 230 liability protections for social-media companies and reviewing purported voter fraud in the 2020 election.
  • Mr. Schumer said Wednesday that Mr. McConnell should allow a stand-alone vote on the House bill increasing the size of the checks, predicting it could get enough Republican votes to advance.
  • Mr. Trump hasn’t weighed in on how he would like Congress to proceed, and the White House didn’t respond to a request for comment. Mr. Trump tweeted Wednesday morning: “$2000 ASAP!”
  • While about a half dozen Senate Republicans have expressed support for larger checks, most have opposed additional spending on top of the $900 billion in aid signed into law Sunday by Mr. Trump.

GOP Senator Josh Hawley Says He Will Force Votes on Joe Biden’s Win – Wall Street Journal, 12/31/20

  • A Republican senator said he would object to the results of the presidential election when Congress holds a joint session next week to certify Democrat Joe Biden as the winner, a move that would force lawmakers to vote to affirm the states’ tallies but has no chance of overturning the outcome.
  • Federal law requires Congress to count and certify the results of each state’s electoral vote in a joint session of Congress on Jan. 6, but lawmakers can raise objections.
  • It takes one member of the House and one senator to formally object and force debate and votes in both chambers.
  • Several House Republicans, including Rep. Mo Brooks (R., Ala.), had already said they planned to object to votes in multiple states, and they had been looking for a senator to join them.
  • Once an objection is filed, lawmakers hold two hours of debate before up-or-down majority votes. Both chambers have to agree in order for the challenge to be successful, an extremely unlikely prospect given that Democrats control the House.
  • But the effort could set the stage for a final public fight over the tally.

Trump Campaign Asks Supreme Court to Overturn Biden’s Wisconsin Win – Wall Street Journal, 12/31/20

  • The Trump campaign said Tuesday it was asking the Supreme Court to overturn President-elect Joe Biden’s victory in Wisconsin, following a similar appeal it filed last week seeking to reverse the Democrat’s win in Pennsylvania.
  • The campaign asks the justices to declare the Wisconsin election “failed” and allow the Republican-controlled state legislature to appoint presidential electors in place of those pledged to Mr. Biden, who won Wisconsin by more than 20,000 votes.
  • But unless the high court grants the campaign’s request to expedite the case, the appeal likely will be moot before it comes up for consideration by the justices.
  • Under Supreme Court rules, the opposing party—in this case, Mr. Biden’s campaign—normally has 30 days after petitions are docketed to file a response, after which the justices schedule a discussion to consider whether to hear the appeal.
  • Mr. Biden won’t be required to respond until Jan. 28 at the earliest, more than a week after he is to be inaugurated as the nation’s 46th president.

EUROPE & WORLD

China Fines Alibaba, JD.com, Vipshop Over Pricing Complaints – Wall Street Journal, 12/31/20

  • China has fined operators of three major e-commerce platforms, including Alibaba and JD.com, $76,600 each for mispricing products, the latest in the barrage of regulatory actions targeting the increasingly influential internet sector.
  • China’s top market regulator, the State Administration for Market Regulation, said Wednesday it investigated the three platforms—Alibaba’s Tmall Supermarket, JD.com and Vipshop Holdings —after receiving complaints from consumers.
  • The consumers accused these platforms of raising prices of products before offering discounts during a major shopping festival in November, which made it look like they were getting a better bargain than they actually were, according to the regulator.
  • The platforms were also involved in making false promotions and employing bait-and-switch tactics, the regulator said.

Exclusive: Chinese regulators probe Ant Group’s equity investments – sources – Reuters, 12/31/20

  • Chinese regulators are reviewing equity investments held by Ant Group Co Ltd in dozens of companies, three people with knowledge of the matter said, intensifying a crackdown on billionaire Jack Ma’s financial technology empire.
  • Regulators are considering whether to instruct Ant to divest some of its investments, mainly in technology and fintech start-ups, if they violate any rules such as creating unfair competition in the market, one of the three sources said.
  • Any enforced divestments would deprive the group of potentially lucrative investments, compounding existing regulatory pressure to revamp its business structure and put up more capital for its key consumer lending business.

Factmonster – TODAY in HISTORY

  • President Truman officially proclaimed the end of hostilities in World War II. (1946)
  • The Marshall Plan expired after distributing more than $12 billion in foreign aid. (1961)
  • Robert Mugabe sworn in as Zimbabwe’s president. (1987)

Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual. Historical performance is no guarantee of future results. All indices are unmanaged and may not be invested into directly.

All investing involves risk including loss of principal. No strategy assures success or protects against loss. Any economic forecasts set forth may not develop as predicted.

All company names noted herein are for educational purposes only and not an indication of trading intent or a solicitation of their products or services.

Material presented is excerpts derived from third party content and you may need a subscription to access the full the content. The views and opinions expressed are those of the authors and do not necessarily reflect the views of Pence Wealth Management or LPL Financial.

Prior to making any investment decision please consult your financial advisor regarding your specific situation.

Follow us on Facebook

Recent Tweets

Categories

Subscribe to Our Blog | Newsletter

Please complete to receive our insights and newsletters.