Dow Futures Surge Into Election Home Stretch After Oct Rout

The Monday Market Minute

  • Global stocks rally from two-month lows as investors react to solid factory activity in Europe and Asia.
  • U.S. election volatility continues to grip markets, however, as does the rising tide of coronavirus infection rates, which could top 100,000 per day in the coming weeks.
  • Europe’s manufacturing PMI reading for October hit a two-and-a-half-month high, while a private sector reading from China surged to the highest in January 2011.
  • The United Kingdom’s four-week lockdown, however, means that as many as six European countries will see restricted movements for the next four weeks in an attempt to tame the latest surge in coronavirus infections.
  • Wall Street futures suggest a firmer open following the worst week for the three major benchmarks since March and ahead of tomorrow’s election drama and a week highlighted by 129 S&P 500 earnings reports.

U.S. equity futures surged higher Monday, fueled by solid factory activity in Europe and Asia, as Wall Street looks to rebound from its worst month since March heading into tomorrow’s Presidential election drama that could roil markets for weeks to come.

Activity in China’s manufacturing sector rose at the fastest pace since 2011 last month, a private report indicated earlier today, while Europe’s factory activity surged to a two-and-a-half-year high thanks in part to Germany’s return to full strength following summer business restrictions linked to the coronavirus pandemic.

However, with Germany one of six European countries instituting lockdowns amid a surge in new winter infections, those numbers are unlikely to be repeated — or even approached — over the final months of the year.

In the U.S., Wall Street’s worst week since March sent the Dow Jones Industrial Average down more than 1,800 points by the close of trading Friday, hiving 6.5% from the benchmark amid a record rise in coronavirus infections, as well as a surge in new hospitalizations, that threatens to accelerate further in the coming months.

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