stocks

Stock Market Today: Investors Lose Their Nerve as Relief Deadline Nears

Retail sales in September improved by more than expected and a consumer sentiment reading improved, providing the market with a tiny lift Friday.

Black Monday, it certainly wasn't. But the 33rd anniversary of Wall Street's worst-ever trading day was nonetheless marked with red ink.

Investors continue to eye COVID stimulus negotiations, which now have a deadline. House Speaker Nancy Pelosi has said that an agreement must be reached by Tuesday to get a bill passed before the November elections. (The Kiplinger Letter's up-to-the-minute forecast: Don't count on relief passing the House and Senate prior to Nov. 3.)

Meanwhile, the U.S. on Friday recorded 68,000 new COVID-19 cases – the country's highest daily total since July – fueling concerns of a long-discussed "second wave" as we approach winter.

The Dow Jones Industrial Average was actually 105 points (0.3%) higher in early trading, but it quickly flipped to losses that accelerated in the afternoon, culminating in a 1.4% loss to 28,195. Apple (AAPL, -2.6%) and Johnson & Johnson (JNJ, -2.6%) were the industrial average's steepest decliners, but the Dow 30's pain was widespread – every Dow 30 component but Intel (INTC, +0.8%) finished lower.

Other action in the stock market today:

  • The S&P 500 declined 1.6% to 3,426.
  • The Nasdaq Composite shed 1.7% to 11,478.
  • Small caps were less dreary, with the Russell 2000 off 1.2% to 1,613.

Buckle Up

No matter how Washington's negotiations turn out, you can expect Wall Street to react with vigor. But from an investing standpoint, understand that "no deal" likely doesn't mean forever ... it probably just means not right now.

"We believe that the probability of a package pre-election is very small and that a bill is unlikely before the end of 2020," writes the Wells Fargo Investment Institute. "Our view is the best chance for an economic support program is in the first quarter of 2021. By then, a package of (conservatively) $2.0 trillion appears likely – possibly more if Democrats control both chambers in the new Congress."

If you can't stand the thought of another herky-jerky ride, you can look to bond funds to provide a counterbalance, or you can always raise a little cash and look for new opportunities once the dust has settled. But for most, we suggest worrying less about the next two days, and game-planning for the next few decades.

That's the idea behind these 10 buy-and-hold mutual funds. This group of products has something for everyone – core stock holdings, sector-specific plays and, of course, fixed income – but they all have a few traits in common, including low expenses and proven track records. Take a look.

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