US stocks rallied on the last day in September, but still saw their first monthly falls since the coronavirus-induced slide witnessed in March. Tradefair brings you the latest financial market news...
"Trump clearly did not assuage concerns about a contested election should he lose."
- Supriya Menon, senior strategist at Pictet Asset Management
Wall Street ended September with its first monthly falls since March, despite stocks staging a slight rally on the last day of the month.
The Nasdaq Composite, which is dominated by technology stocks, suffered the biggest losses over the course of September, while both the Dow Jones Industrial Average and the broader S&P 500 were also down on the month.
Investors are currently grappling with uncertainty related to the US election on November 3, which was heightened this week by a chaotic debate between Donald Trump and the Democratic presidential nominee Joe Biden. Trump has previously refused to commit to a peaceful transfer of power, should he lose the election.
September ends in the red
The main Wall Street indices all gained value on the last day in September, with the Dow up 1.2%, the S&P 500 rising by 0.83% and the Nasdaq gaining 0.74%.
It wasn't enough to prevent losses over the month as a whole, however. The Nasdaq ended September more than 6% off the record highs it achieved at the start of the month, while the S&P 500, which also hit unprecedented peaks early in September, dropped by more than 4.6% during the month.
The Dow, which climbed to a record high back in February, registered a 3% fall in September.
This brings to an end a five-month growth trend on Wall Street, as markets steadily recovered the value that was lost back in March, when the US economy started to feel the effects of the coronavirus outbreak.
One of the key drivers of recent trends on the markets has been speculation over the possibility of additional fiscal stimulus from Congress to aid the ongoing recovery from the pandemic.
Yesterday's (September 30) rally was fuelled by renewed optimism that lawmakers could break weeks of deadlock and reach a deal.
Treasury secretary Steven Mnuchin said he was "hopeful" about the possibility of an agreement being made in talks with Nancy Pelosi, the Democratic speaker of the House of Representatives.
"We're going to give it one more serious try to get this done," he told CNBC.
"I think there is a reasonable compromise here. It's something that the president very much wants to get done."
Market developments are also being shaped by growing political uncertainty in the build-up to the presidential election in just over a month.
Biden and Trump this week took part in a heated and acrimonious debate, in which the political opponents traded insults, bickered and frequently spoke over each other.
The Commission on Presidential Debates responded by saying it would change the format for future encounters between the candidates to make them more orderly. One measure being considered is cutting off a speaker's microphone if they attempt to interrupt the other person, CBS News reported.
Financial market uncertainty around the outcome of the election has been increased by Trump's refusal to commit to a peaceful transfer of power if he loses.
When he was questioned on the issue in a White House press conference, the president repeated his claim that increased use of mail-in ballots during the pandemic raises the risk of voter fraud.
"We're going to have to see what happens. You know that I've been complaining very strongly about the ballots, and the ballots are a disaster," he said.
"We want to get rid of the ballots and... there won't be a transfer, frankly, there will be a continuation."
Discussing the president's performance in this week's debate, Supriya Menon, senior strategist at Pictet Asset Management, told the Financial Times: "Trump clearly did not assuage concerns about a contested election should he lose."
Gains in Europe and Asia
Markets all over the world will be affected by the outcome of the US presidential election in November, and have also been influenced by fresh hopes that Congress is inching closer to a new economic stimulus package.
In London, the FTSE 100 was up by 0.9% going into the last hour of morning trading on Thursday, while France's CAC 40 gained 0.7%. The pan-European Stoxx 600 increased by 0.5%.
Asian trade was affected by holidays in China and South Korea, as well as a technical glitch on the Tokyo Stock Exchange (TSE), which led to the suspension of all share trading in Japan. The TSE was forced to halt operations for the whole day on Thursday and said it was not sure when the problem would be fixed.
Shanghai's SSE Composite Index saw a slight fall of 0.2%, while Hong Kong's Hang Seng Index was up by 0.8% and the Asia Dow gained 0.3%.
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