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OCTOBER 2020 REVIEW
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“Uncertain Times Bring Uncertain Markets”
Following a dismal first quarter, markets rose sharply from April through August, wiping out
most, if not all of the losses that accumulated during the latter part of February into March.
However, global markets have retreated since early September due to rising COVID-19 cases
across the globe, little progress towards another U.S. fiscal stimulus deal, as well as the
uncertainty of the upcoming election, and whether the election would be contested. With so
many market headwinds, the S&P 500 fell 2.7%, the Dow Jones Industrial Average lost 4.5%,
and even the seemingly invincible NASDAQ dropped 2.3% last month.
As restrictions relaxed over the late spring and summer months, the concern that lingered was whether
looser restrictions and cooler fall weather would result in a spike in coronavirus cases. Unfortunately,
that concern was warranted, as cases have risen significantly, particularly within the U.S., South
America, Europe, and India. Rising coronavirus infections and deaths in Europe have already triggered
tougher restrictions. France imposed a new month-long nationwide lockdown, ordering people to stay
at home except for essential work or medical reasons and ordered people to fill out a form to justify
leaving their homes, similar to the initial lockdown in March. Social gatherings were also banned. In
Germany, Chancellor Angela Merkel and the 16
state premiers agreed to a partial lockdown that
will last until November 30th, where restrictions
include the closure of restaurants, bars, gyms
and theaters. Social contacts will be limited to
two households with a maximum of 10 people
and tourism will be halted. As Europe begins
to deal with the higher coronavirus infections,
the U.S., in the midst of an election and political
tug of war, now must face its own reality of
rising cases and a plan to address the issue. As
such, fears of a second national lockdown have
resurfaced, and markets have react