How Will the Electoral College Impact the Stock Market Today?
As we start the new week, watch for market reactions to government-related news as the first COVID-19 vaccines are administered, stimulus talks continue and electors cast their ballots.
1. Friday’s market numbers were mixed.
The S&P 500 closed down 0.13% and the Nasdaq was down 0.23%. Declines led advances by 1.4 to 1 on the New York Stock Exchange.
2. Covid vaccine rollout starts.
Pfizer (NYSE: PFE) started shipping its COVID-19 vaccine on Sunday, and hospitals are expected to begin giving injections as early as today. This is good news, but keep in mind that adverse reactions to drugs often appear when wide-scale distribution begins. In drug industry parlance, the post-marketing phase of a drug’s introduction is known as a phase IV trial, and researchers expect to learn more about the vaccine as it goes into widespread use.
3. The Electoral College meets on Monday.
Electors are expected to follow the popular vote and make Joe Biden’s election official. Most years, the Electoral College procedure is perfunctory. This year, it is likely to be accompanied by political posturing. The markets are not looking for drama, but it might be a good idea to stay off of social media.
4. Earnings reports will trickle in.
Those companies that had quarters ending on Nov. 30 will start reporting this week. Thursday is the biggest day on the calendar, with Accenture (NYSE: ACN), Rite Aid (NYSE: RAD), FedEx (NYSE: FDX) and General Mills (NYST: GIS) expected to report.
5. Will we have another shutdown?
Congress did not reach a budget agreement last week, although it made progress. President Trump signed a stopgap bill extending government spending until Dec. 18. Will we avoid another shutdown? Will there be any stimulus spending? Expect another week of uncertainty and volatility.
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