The U.S. economy’s recovery continues despite the increase in coronavirus cases in many parts of the country. This week, the retail sales report will most likely show that retail sales continue to increase, albeit at a slower pace than in the previous six months. The level of retail activity will likely exceed the level seen before the pandemic. The mixture of retail sales and consumer behavior has changed since the beginning of the pandemic, but overall activity continues to be robust as consumer liquidity remains high for many.
U.S. corporate earnings season continues this week, and so far, the third quarter has seen solid earnings that have supported equity valuations near record-high levels. Over the next several weeks, discussions about additional stimulus will likely heat up, and the potential for another deal could continue to drive stocks higher.
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