A Review of Q4

Stock Market Volatility

2020 has been a year to remember. Industries have adapted to changing consumer habits, markets have fluctuated, and people have spent countless hours on Zoom (ZM). We’re breaking down important events that took place during each quarter of the year. Today, we’re taking a look at Q4 of 2020.

The beginning of the fourth quarter was a time of uncertainty. In October investors were anxious about the results of the US presidential election. As the weather turned colder, COVID-19 cases began to rise in many parts of the world, causing governments to place more stringent restrictions on businesses. At the beginning of the quarter vaccine trials were still in progress, and investors were unsure if and when a vaccine would become available. Over the course of October the S&P 500 dropped by 2.8%, the Nasdaq fell 2.3%, and the Dow Jones tumbled 4.6%.

Indexes rebounded in November. The S&P 500 rose 10.8%, the Nasdaq climbed 11.8%. The Dow Jones also surged 11.8%, posting its most significant monthly gains since January 1987. In December investors were concerned about rising COVID-19 cases impacting businesses in the near future, though sentiment was lifted because of positive news on the vaccine front.

A US Presidential Election for the History Books

On November 3, 2020, millions of Americans headed to the polls. By this date, millions of other citizens had already voted by mail. About 160 million Americans voted in the presidential race—an all-time record high. The election also had the highest voter turnout rate among eligible citizens since 1900.

President-elect Joe Biden won 306 electoral votes and President Donald Trump won 232 electoral votes. Democrats kept control of the House. Control of the Senate will be decided by a January 5 special election in Georgia. The presidential election, and many races up and down the ticket, were close and contentious.

There are still many questions about what lies ahead for the economy and markets. But now that some of the uncertainty surrounding the election has subsided, investors have a clearer picture of how the next four years will look.

COVID-19 Vaccine Rollout Begins

After nearly a year of tragedies brought on by the COVID-19 pandemic, the world finally saw glimmers of hope thanks to the fastest vaccine development initiative in history. Over the summer Moderna (MRNA) and Pfizer (PFE) shared positive news from Phase 1 and 2 trials.

The companies then began Phase 3 trials with over 70,000 people participating around the world. These trials showed both vaccines to be about 95% effective, and both vaccines went on to receive emergency approval from the FDA Developing COVID-19 vaccines this quickly was a remarkable accomplishment. Now the challenge will be distributing them to millions.

Though the pandemic is far from over, investors in a number of industries and average people who have faced innumerable difficulties in 2020 have some form of a light at the end of the tunnel.

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