Wall Street ends little changed, posts big weekly gain on Washington gridlock hopes

NEW YORK: U.S. stocks held near the unchanged mark on Friday to close out a strong week as Democratic challenger Joe Biden edged closer to victory in the presidential election, while the monthly jobs report underscored the hurdles still facing the economy.

Biden built on narrow leads in Pennsylvania and Georgia, putting him on the verge of winning the White House, although President Donald Trump has filed lawsuits in battleground states to contest the results.

The three major indexes notched their biggest weekly percentage gains since April as the prospect of policy gridlock in Washington eased worries a Biden administration might tighten regulations on U.S. companies.

“It’s not fairytale land, we don’t go up every day so at some point you would think we would see a little bit of downward pressure,” said JJ Kinahan, chief market strategist at TD Ameritrade in Chicago.

Control of the U.S. Senate could hinge on four as-yet undecided races. If Republicans retain their majority, they would likely block large parts of Biden’s legislative agenda, including expanding healthcare and fighting climate change.

“There is some concern with regards to if Biden creeps ahead or wins Georgia then there is chance that those (Senate) seats will follow. That’s what people are reading into this,” said Yousef Abbasi, global market strategist at Stonex Group Inc, New York.

The government’s closely watched report showed unemployment dropped sharply to 6.9% last month from 7.7% in September, but job recovery slowed as fiscal support waned and coronavirus cases surged.

After the jobs report, U.S. Senate Majority Leader Mitch McConnell said economic statistics indicated Congress should enact a smaller coronavirus stimulus package that is highly targeted at the pandemic’s effects. The Dow Jones Industrial Average fell 66.78 points, or 0.24%, to 28,323.4, the S&P 500 lost 1.01 points, or 0.03%, to 3,509.44 and the Nasdaq Composite added 4.30 points, or 0.04%, to 11,895.23.

Coty Inc surged 22.16% as the cosmetics maker beat analysts’ estimates for quarterly revenue, while T-Mobile US Inc gained 5.37% after adding more phone subscribers than analysts had expected in the third quarter.

Electronic Arts Inc slumped 7.12% after the video game maker fell short of quarterly sales estimates.

Volume on U.S. exchanges was 10.36 billion shares, compared with the 9.23 billion average for the full session over the last 20 trading days.

Declining issues outnumbered advancing ones on the NYSE by a 1.41-to-1 ratio; on Nasdaq, a 1.63-to-1 ratio favored decliners.

The S&P 500 posted 51 new 52-week highs and no new lows; the Nasdaq Composite recorded 133 new highs and 32 new lows.