Dow and S&P 500 stocks are off to a soft start, while the Nasdaq continues to make fresh record highs as the coronavirus rampages across the US and as Washington DC struggles to show any significant progress over two fiscal cliffs, both funding the government and passing a defense spending bill. Many lawmakers want to get a deal that delivers COVID-19 funding relief and funds the government before the end of the week, but what seems more likely is they will pass a one-week band-aid solution.
The Nasdaq keeps rising, supported by Apple’s innovation to deliver a new 32-core processor for high-end Macs. Most of the European bourses are negative, with the FTSE grasping at small gains as the British pound falls, making exports slightly more attractive.
This week on the virus front, Wall Street is expecting good news with Pfizer’s vaccine getting the greenlight to start immunizations, bad news with lawmakers struggling to break the impasse on stimulus relief, and the ugly Thanksgiving surge taking COVID-19 even higher. The current virus hotspots are back in the big cities, with California, Texas, Illinois, Florida, and New York all seeing the largest increases over the last week.
Health and Human Services Secretary Azar has put a key goal that every American should be able to get a vaccine by the second quarter. The uncertainty over how many Americans are willing to get vaccinated will become just as important, but right now it seems the larger cities might have a more willingness to vaccinate.
Apple releases new computer chip
Apple’s new M1 chip may put an end to their use of Intel’s chips. Following the November 10th release of their M1 chip, investors new Apple was looking to gain more control over the products they create. The M1’s debut with MacBook Air, MacBook Pro and Mac Mini all went well. Apple’s in-house silicon chips now are targeting the highest-end PCs possibly early next year.
Intel’s revenue stream is roughly 10% from Apple and shares have recovered most of their initial losses. In tech, lately the biggest companies have been getting bigger, but this could be viewed as a positive for helping drive innovation, since Intel has historically been slow to deliver new chips.
GBP dips as time running out on Brexit
The British pound declined against all of its major trading partners as investors placed bearish hedging positions and some doubted that a deal would be made by Wednesday’s artificial deadline. Sand is running out of the Brexit hourglass as the UK seems to have ruled out extending the Brexit transition period. Hopes for a weekend deal were unrealistic as a deal as both sides need to show that they are fighting for the best possible trade deal. The true deadline will likely be at some point at the end of this week, which could mean a week full of drama could start to weigh on the pound.
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