Stocks rose on Monday, the first trading day of the month, as markets recovered some of the sharp losses from last week and braced for the U.S. presidential election.

The Dow closed 423.45 points higher, or 0.6%, at 26,925.05. The S&P 500 gained 1.2% to end the day at 3,310.24. The Nasdaq Composite rose 0.4% to 10,957.61.

Honeywell and Walgreens Boots Alliance were the best-performing Dow stocks on Monday, gaining more than 5% each. The S&P 500 was led higher by gains in the energy, materials and industrial sectors. Energy and materials each gained at least 3.4% and industrials popped 2.7%. Big Tech, meanwhile, struggled as Facebook and Amazon dipped 0.7% and 1%, respectively.

The major averages hit their session highs on Monday after Institute for Supply Management said its manufacturing index reached a two-year high in October. The market’s comeback came even as England adopted a stay-at-home order to fight the coronavirus.

Earnings season continues on Tuesday with Bayer, Fox Corp and Humana reporting before the bell.

Plan A : Long if market doesn't retrace much and supported firm above 3304. Targets are 3320, 3335 and 3349. 

Plan B : Short if market failed to support above 3304. Targets are 3279, 3250 and 3221.
 

U.S. stock futures rose in overnight trading as investors waited for Tuesday’s presidential election between incumbent Donald Trump and former Vice President Joe Biden.

On Monday, the Nasdaq Composite was the relative underperformer, adding just 0.4% as Facebook, Amazon, Apple and Microsoft all closed lower.

“Today’s strong stock market gain was fueled by technical support — a stock market which bounced decisively from its recent lows, a nod to ongoing economic momentum, despite a recent spike in Covid cases,” Jim Paulsen, chief investment strategist at the Leuthold Group, told CNBC. “As the election finally nears, investors who were selling on the rumor may now be buying on the news, and finally, after almost a 10% decline in the last month, buying on the dip is back.”

Stocks also got a boost after manufacturing activity in October jumped to its highest level in more than two years, pointing to a resilient economy in the face of the coronavirus. The ISM Manufacturing PMI rose to 59.3, a reading that indicates the percentage of companies reporting that activity expanded during the month. 

Heading into Tuesday, Joe Biden holds a lead in national polling over President Donald Trump. A full day before Election Day, more than 94 million votes have already been cast in the U.S, already exceeding or nearing total levels in 2016, according to the U.S. Elections Project.

Investors are also eyeing the key Senate election which will determine if the a so-called Blue Wave will take over Congress. Major policy shifts including further fiscal stimulus depend on which parts has majority control.

Plan A : Long if market supported firm above 11121. Targets are 11150, 11182 and 11210.

Plan B : Short if market failed to support above 11121. Targets are 11083, 11045 and 11000.
 

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