US stocks traded down slightly on Tuesday morning ahead of the first presidential debate between Joe Biden, the Democratic nominee, and President Donald Trump.
The heightened politics heading into the November election have reduced investors' hope that Congress will pass an additional stimulus package.
But that hasn't stopped House Democrats from proposing a new COVID-19 relief package worth $2.2 trillion. It would restore the $600 weekly unemployment benefit and has many measures designed to appeal to Republicans, including aid to the airline industry.
House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin are set to continue talks on the stimulus package on Tuesday.
Here's where US indexes stood soon after the 9:30 a.m. market open on Tuesday:
- S&P 500: 3,347.07, down 0.14%
- Dow Jones industrial average: 27,551, down 0.12% (32.08 points)
- Nasdaq composite: 11,109, down 0.07%
According to UBS, investors can expect the presidential debate to produce little policy substance, though it could matter which candidate is thought to be the winner.
"Perceptions of performance and whether candidates were able to change the views of floating voters does make a difference," UBS said.
The economist Mohamed El-Erian said on Monday that investors shouldn't hold out hope for additional stimulus from Congress or the Federal Reserve.
Goldman Sachs said that a Democratic sweep in November would be "modestly positive" for US corporate earnings.
Gold rose as much as 0.47%, to $1,890.31 per ounce.