Stocks declined on Monday as investors prepared for the U.S. presidential election and a potential Federal Reserve rate cut later this week. The Dow Jones Industrial Average dropped 257.59 points or 0.61 per cent, closing at 41,794.60. The S&P 500 fell 0.28 per cent to 5,712.69, while the Nasdaq Composite decreased by 0.33 per cent to 18,179.98.
Trading was turbulent, with the Dow briefly plummeting over 400 points, and the S&P 500 and Nasdaq experiencing fluctuations between gains and losses.
Tuesday’s election results could have a significant impact on year-end stock performance. A recent NBC News poll indicates a "deadlocked race" between former President Donald Trump and Vice President Kamala Harris.
A minor rally in Nvidia provided some market stability for most of the day, with shares closing up about 0.5 per cent after it was announced the chipmaker would replace Intel in the Dow. Nvidia has surged 174 per cent year-to-date, while Intel has seen its value drop by more than half in 2024.
Meanwhile, utility stocks faced pressure after regulators rejected Talen Energy’s request to boost nuclear power for an Amazon data center. In contrast, stocks related to fossil fuels and solar power rose, with oil increasing by 2 per cent. Financials and healthcare stocks also struggled, with Goldman Sachs and UnitedHealth Group falling 1.5 per cent and 1.7 per cent, respectively, contributing to the Dow’s decline.
As Wall Street awaits the Federal Reserve's rate decision on Thursday, traders anticipate a 98 per cent chance of a quarter-point cut, following a half-point reduction in September. The day’s stock movements coincided with a rally in safe-haven U.S. Treasurys, indicating some investors are reducing risk ahead of the election. The benchmark 10-year Treasury yield fell to about 4.3 per cent, down from roughly 4.36 per cent on Friday, reflecting the inverse relationship between bond prices and yields.
Futures
The SPI futures are pointing to a 0.4 per cent fall.
Currency
One Australian dollar at 8.35am was buying 65.84 US cents.
Commodities
Gold has lost 0.15 per cent. Silver has fallen 0.28 per cent. Copper gained 1.32 per cent. Oil jumped 3.24 per cent.
Figures around the globe
European markets closed mixed. London’s FTSE added 0.09 per cent, Frankfurt lost 0.56 per cent, and Paris closed 0.50 per cent lower.
Turning to Asian markets, Tokyo’s Nikkei was closed , while Hong Kong’s Hang Seng added 0.30 per cent and China’s Shanghai Composite gained 1.17 per cent.
Yesterday, the Australian share market closed 0.6 per cent higher at 8165
Ex-Dividend
EZZ Life Science (ASX:EZZ) is paying 2 cents fully franked
Dividends payable
Gowing Bros Ltd (ASX:GOW)
Sources: Bloomberg, FactSet, IRESS, TradingView, UBS, Bourse Data, Trading Economics, CoinMarketCap, Marketech.
