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A Quarterly Market Review in 6 Charts: Third Quarter 2020

Morningstar’s third-quarter 2020 market commentary covers U.S. economic recovery, reducing ties with China, and more.

The U.S. economy made up ground in the third quarter that was lost in the first half of the year courtesy of the coronavirus pandemic, with businesses reopening and production resuming that was previously halted. Gross domestic product grew 7.4% in the third quarter, equivalent to an annual rate of 33.1%. This is in stark contrast to the second quarter, where it dropped at a record pace of 9%, or 31.4% at an annual rate.

U.S. stocks continued their upward trend from the second quarter, with an 8.9% quarterly gain. However, stocks slid in September over caution of increasing virus case numbers in the United States and Europe without the prospect of a vaccine soon. This was in addition to pending election uncertainty surrounding taxes, healthcare, and foreign relations. Investors have tried to profit off the increased market volatility, although not successfully.

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