Markets Right Now: S&P 500 extends losing streak to 8 days

Markets Right Now: S&P 500 extends losing streak to 8 days

Troy Powers
November 5, 2016

In Europe, the Stoxx Europe 600 was off 0.8%.

With traditional valuation measures such as the price-earnings ratio looking expensive, further growth in earnings is needed to support higher levels for the index, Da Sie said.

USA stocks steadied in late morning trading on Thursday, with the S&P 500 on track to break its longest losing streak in five years, although a fall in Facebook's shares capped gains.

The index last fell nine straight days in December 1980, according to Howard Silverblatt, senior index analyst at S&P Dow Jones Indices.

That marks its eight day on the trot of drops - falling 0.4 per cent thanks to a drop in Facebook shares and ongoing uncertainty over the upcoming U.S. presidential election, causing investors to dial back the risk.

Clinton had a clear lead until last Friday, October 28, when it was announced that the FBI was reopening its investigation into her private email server.

Investors continue to focus on the US presidential election, which has become too close for comfort for some investors and has put the market on the defensive.

Not only have markets fallen in the past week, but the VIX, an index that measures volatility, has risen sharply as well, surging over 14% today and is up to 22.08 today from 13 on October 24, the last time the S&P 500 rose on a trading day.

Despite the historic run, the S&P has pulled back by only about 3.1 per cent over that time.

If the index loses again Monday, it would be the longest losing streak since mid-1975.

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Employment growth in the USA remained tepid in October, according to figures released by the government on Friday. While the gauge has climbed an average 1.9 percent in the run-up to elections going back to 1928, it's down 1.8 percent since Monday, with two market days left until polls open November 8.

The spike in volatility "tells you people are buying protection, there is a little bit more concern", said Matt Jones, US head of equity strategy at J.P. Morgan Private Bank in NY.

"There's a lot of headline risk out there".

US employers added a solid 161,000 jobs in October and raised pay sharply for many workers.

The government repored that 161,000 jobs were created last month, shy of the 175,000 economists had forecast, although job gains in August and September were revised up a combined 44,000.

"Canada was somewhat disappointing because it had, on the surface, some nice job growth, but underneath it was all part-time", Levine said.

Starbucks (SBUX.O) shares were up 1.4 percent at $52.50, a day after the company reported better-than-expected quarterly results.

Consumer staples were the worst-performing group, falling 1 per cent.

Advancing issues outnumbered decliners on the NYSE by 1,600 to 1,184.

Moreover, in the first post-election year, the S&P 500 experienced an average 9.8% when a the political party of the president transitioned from a Democrat to a new Democrat, whereas the index saw an average 10.2% decline when the political party changed from a Democrat to a Republican.