The best midsize luxury SUVs of the year, ranked


The midsize luxury SUV segment is extremely competitive. This is an area where almost every luxury brand has a seat at the table and they all have different sets of strengths and weaknesses. Some are better off-road, some are all about on-road performance and some are more family-oriented with roomy 3-row seating. Whatever you’re looking for in a midsize luxury SUV, you’ll find something perfect for your wants, your needs and your budget on this list.

Here are the best midsize luxury SUVs for 2020, ranked.

1. Mercedes-Benz GLE-Class

Score: 4.8 / 5

The 2021 Mercedes-AMG GLE 63 S


Mercedes-Benz

Mercedes-Benz has been working on midsize luxury SUVs for quite some time and the all-new 2020 Mercedes-Benz GLE-Class is the closest that the brand has come to truly perfecting this formula.

In classic Mercedes-Benz fashion, the GLE-Class seamlessly combines high-end luxury with engaging performance and in this case, it’s wrapped in a practical and stylish SUV that’s just the right size. The interior is arguably the nicest in this class and it’s packed with the latest technology in both safety and infotainment. One of its few faults is a cramped optional third row of seats.

This SUV makes more sense with the standard 2-row configuration. We admit, sometimes the technology can get in its own way. If you prefer just the basics when it comes to lowering the interior temperature, you might not like the Benz setup here. Still, this is an excellent midsize luxury SUV. It’s a little pricey for this class with a starting MSRP of $54,250, but it’s so good that the price tag is justified. The GLE was on our list of the best cars of 2019. 

2. Audi Q8

Score: 4.8 / 5

When a luxury brand comes out with an “SUV coupe,” it usually means making big compromises on practicality to get a more stylish body. However, the Audi A8 is a sleek SUV with a sloping roofline that also manages to have generous passenger space and plenty of cargo space. Its interior is breathtaking, with a high-end design and quality materials throughout, and its sharp handling makes it feel like a smaller car. All-wheel drive is standard, which improves all-season traction.

Many of us prefer the equally spectacular Q7 but that’s largely a matter of individual taste. The starting price is high at $68,200, but it comes generously equipped with standard features, delivering a truly luxurious experience.

3. BMW X5

Score: 4.8 / 5

The BMW X5 is one of the original midsize luxury SUVs and in 2020, it’s still one of the best. We know it’s cliché to call it “the BMW of SUVs,” but it’s an accurate way to describe this luxurious crossover with agile handling and a powerful engine lineup. A third row of seats is optional, but they’re a bit cramped and we’d recommend a different SUV on this list if you need extra seats.

Where this BMW
BMWYY,
+1.62%

  excels is in the fun-to-drive factor while also serving up practicality with its roomy cargo hold and its intuitive infotainment system. The starting price of $58,900 puts it on the expensive side, but it’s well worth it for the right driver. 

4. Audi Q7

Score: 4.7 / 5

The Audi Q7 is right up there with its chief competitors from BMW and Mercedes-Benz in terms of interior opulence, stately styling and agile handling. The Q7 features standard 3-row seating, but like most of its competitors, space in the third row is quite tiny. The Q7 received a nice mid-cycle refresh for 2020 which includes updated styling, a dual-screen infotainment system, a new mild-hybrid setup for the V6 engine and the debut of the high-performance SQ7 for drivers looking for some extra punch under the hood. Like the Q8, AWD is standard on the Q7. Pricing is a little steep starting at $54,800, but like its other German competitors, it’s worth it for drivers who appreciate the finer things in life.

5. Acura MDX

Score: 4.6 / 5

The 2020 Acura MDX


Acura

The Acura MDX is arguably the strongest value of any SUV on this list with its attractive starting MSRP of $44,500. It’s also a family-friendly choice, with standard 3-row seating that actually has some decent room in the third row. The interior design is getting a little dated and it’s not quite as premium as many of its rivals, but it’s nice considering the price tag.

Don’t miss:The best small luxury cars of the year

The standard V6 engine delivers an excellent balance of performance and fuel economy, but if you’re looking for something even more efficient, there’s a Sport Hybrid variant available which improves both performance and efficiency and throws in standard AWD. The hybrid starts at $52,800, which is still more affordable than many non-hybrid rivals. Find an Acura MDX for sale

6. Volvo XC90

Score: 4.6 / 5

The Volvo XC90


Volvo

In terms of interior quality, the 2020 Volvo XC90 is just as nice as more expensive German rivals while carrying a competitive starting MSRP of $48,350. That price is even more attractive when you consider the long list of standard technology and safety features in this handsome Volvo
VLVLY,
+2.72%

 .

This is a great 3-row luxury crossover for families with its roomy cabin with standard 3-row seating and a generous cargo area to boot. The XC90 gets some slight tweaks for 2020, including revised styling and, finally, available seating for six with second-row captain’s chairs. The base engine is good on gas but a bit lacking in performance and we prefer the T6 powertrain setup. Find a Volvo XC90 for sale

7. Porsche Cayenne

Score: 4.5 / 5

Porsche Cayenne GTS


Porsche

The 2020 Porsche Cayenne is still fresh off a 2019 redesign and introduces a new “coupe” body style for 2020. The Cayenne checks every box you would expect from a Porsche SUV. It’s fast, it’s luxurious and it carries styling that makes it unmistakable as a Porsche.

Check out: 9 smart dog accessories for your car

You could upgrade to one of the hotter available engines, but most drivers will be more than satisfied with the standard turbocharged engine and standard AWD. Unsurprisingly for a Porsche, the Cayenne is toward the top of the price range in this segment with a starting MSRP of $66,800, making it good for drivers to prioritize performance over value. 

8. Lexus RX

Score: 4.5 / 5

The 2020 Lexus RX is a favorite among drivers looking for a midsize luxury SUV that is safe, comfortable, reliable and efficient. There aren’t a lot of surprises with the RX and for many drivers, that’s a good thing. The interior is very nice and the ride is gentle, making it a good commuter with the versatility of an SUV. A third row of seats is available in the form of the RXL, but the optional extra seats don’t offer much legroom. The RX is a great family SUV as long as you don’t really need a third row. Value is the name of the game with a starting MSRP of $44,150, while the thrifty RX Hybrid starts at just $46,245. 

9. Land Rover Range Rover Sport

Score: 4.3 / 5

The Land Rover Range Rover Sport


Land Rover USA

If you’ve always wanted a Range Rover but you also want available three-row seating and a more affordable price, then the 2020 Land Rover Range Rover Sport is the luxury SUV for you. With standard 4-wheel drive, the Range Rover Sport doesn’t skimp on the off-road performance that its name promises, and its range of powerful engines gives it outstanding on-road performance as well.

The interior is comfortable and nicely designed, but the cargo area is a bit tight. Mild-hybrid and plug-in hybrid options were added for 2020, making this SUV a little greener. Base price for a Range Rover Sport is just under $70,000. 

10. Infiniti QX60

Score: 4.2 / 5

Looking for a luxury midsize SUV with third-row seating you can actually use? The 2020 Infiniti QX60 isn’t as opulent or sporty as some of its rivals, but it’s one of the most family-friendly crossovers in this class with a standard third row that is easy to access thanks to sliding second-row seats.

Don’t miss:Four electric and hybrid SUVs that can tow some serious weight

Adding to its family-friendliness is good cargo space, an available rear-seat entertainment system and a coveted Top Safety Pick+ from the Insurance Institute for Highway Safety. The standard V6 is strong and good for family-hauling while also being pretty good on gas. It’s also a strong value, with a starting MSRP of $44,350. Even upgrading to the Luxe AWD model still keeps the price under $50k.

11. Land Rover Range Rover Velar

Score: 4.2 / 5

Sitting above the Evoque and below the Range Rover Sport in the Range Rover lineup is the 2020 Land Rover Range Rover Velar. This 2-row midsize SUV exudes elegance inside and out with posh styling and a composed ride. A new V8 engine making a whopping 550 horsepower joins the Velar lineup for 2020, making this Range Rover more competitive with high-performance German luxury SUVs. Four-wheel drive is standard and its off-road capabilities are better than you might expect for such a fashionable SUV. Its starting price of $56,300 is a bit steep considering some of its more modern German rivals with nicer interiors and similar prices.

12. Lincoln Aviator

Score: 4.1 / 5

The Lincoln Aviator


Lincoln

The roomy 2020 Lincoln Aviator is another family-friendly choice in midsize luxury SUVs with standard 3-row seating. It’s one of the most stylish SUVs in this segment with a gorgeous exterior and a more opulent interior than you might expect. It’s also quite advanced technologically with one of the best infotainment systems in this class.

The ride is comfy and the standard twin-turbo V6 engine pumping out 400 hp is fantastic, but when it comes to handling, some rivals are more agile. It starts at a reasonable $51,100 and the higher-performance Grand Touring plug-in hybrid variant starts at $68,800. The all-new Aviator is the only vehicle from a luxury brand to earn a spot on our Best New Cars for 2020 list. 

13. Maserati Levante

Score: 4.1 / 5

The 2020 Maserati Levante


Maserati USA

Maserati performance and style come in a versatile midsize SUV in the form of the 2020 Maserati Levante. The Levante offers two incredible Ferrari-built engines under the hood, a 345-hp twin-turbo V6 and a 590-hp twin-turbo V8. Think of it like a high-end sport sedan but with an SUV body. The Levante also has sharp handling and it just might have the most satisfying exhaust note of any SUV on this list. However, its $72,990 base price makes the interior quality feel a bit lacking. The Porsche Cayenne is arguably a better value for a performance-oriented midsize luxury SUV. 

See: 10 SUVs that are really fun to drive

14. BMW X6

Score: 4.0 / 5

The BMW X6


BMW USA

All-new for 2020, the BMW X6 has a sleek coupe-like body that looks cool but results in a compromise of practicality. The seats are super-comfortable, but the steep roofline cuts into the cargo area quite a bit while also hurting rear visibility. That said, the cabin is extremely well-designed and full of high-end materials plus a long standard features list. It has a lineup of very strong engines, but as comfortable and as fast as it is, its 6-figure starting MSRP of $108,600 is hard to justify. The BMW X5 M is slightly cheaper, much more practical and delivers 567 hp that you’re unlikely to get bored with. 

15. Cadillac XT5

Score: 4.0 / 5

The Cadillac XT5 is a competitively priced midsize 2-row luxury SUV that takes the fight directly to the Lexus RX but can’t quite match its Japanese rival. The XT5 is a good SUV with a sharp aesthetic, a comfortable ride and a strong predicted reliability rating from J.D. Power. It got some nice updates for 2020 including a new infotainment system, a new turbocharged base engine that is good on gas and a stylish new Sport trim. Where the XT5 is lacking is interior quality and tight back seat headroom for a midsize SUV. It’s attractively priced starting at $44,095, but similarly-priced Japanese luxury SUVs are better buys. 

16. Lincoln Nautilus

Score: 3.9 / 5

The Lincoln Nautilus is another American 2-row luxury SUV that takes a shot at the Lexus RX and makes a good effort but falls a bit short of greatness. It’s a nice, comfortable, practical crossover, but there’s nothing that makes it really stand out in this class.

More on MarketWatch:

In Black Label form, it does eclipse the RX in terms of interior materials, color choices and textures, but that’s nearly a $60,000 car. You do get a host of concierge-level service but it’s a pricey option. Its most competitive factor with the Nautilus is actually at the other end of the spectrum — its price, which starts at $41,040, making this Lincoln a strong value for anyone looking for a comfy, quiet cruiser with SUV versatility. Both available engines are efficient and upgrading to the twin-turbo V6 adds more power, but the handling of the Nautilus isn’t what we’d call athletic. 

Also see: 8 new luxury SUVs for under $50,000

17. Cadillac XT6

Score: 3.9 / 5

The 2020 Cadillac XT6 is an all-new entry in the competitive 3-row luxury crossover segment and fails to stand out compared with the best midsize luxury SUVs. It has a dignified appearance, and its interior is roomy and family-friendly with plenty of room in its standard third row of seats, but that’s about where its virtues end. The sole engine choice is a naturally aspirated V6, which has enough guts for family-hauling duty, but there isn’t much of a fun-to-drive factor here. The interior quality is good but not great, which kind of sums up this whole SUV. This Cadillac is moderately priced starting at $52,695. 



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2020 is the year of the SPAC — yet traditional IPOs offer better returns, report finds


After a record 82 initial public offerings of special purpose acquisition corporations — known by the acronym SPAC — 2020 seems to have upended the traditional IPO market, yet most offer lower returns on average than conventional deals, according to a report.

Of 223 SPAC IPOs conducted from the start of 2015 through July, 89 have completed mergers and taken a company public, offering the chance to examine their performance, according to the report from Renaissance Capital, a provider of IPO ETFs and institutional research. Of those 89, the common shares have delivered an average loss of 18.8% and a median return of minus 36.1%. That compares with the average after-market return from traditional IPOs of 37.2% since 2015.

As of July 24, only 26 of the SPACs in that group had positive returns, the study found.

SPACs, also known as blank-check companies, have been around since the 1980s, but have become a juggernaut this year amid high levels of liquidity and a strong appetite for new growth companies.

Don’t miss: The CEO who made one of Silicon Valley’s worst acquisitions wants a $400 million blank check

SPACs raise money in an IPO, and then place it in a trust while the sponsor searches for a business or businesses to acquire, usually within a two-year period. The companies then complete a merger and the target becomes a listed stock. Recent examples include sports-betting operator DraftKings Inc.
DKNG,
-3.31%
,
electric truck maker Nikola Corp.
NKLA,
-1.60%

and space travel company Virgin Galactic Holdings Inc.
SPCE,
-3.69%
.

“It’s a back door to going public and avoiding scrutiny,” said Kathleen Smith, Principal at Renaissance. “You hear about the moonshots, like DraftKings and Virgin Galactica, which have done well, but the average return is negative. You can’t just blindly go in and make money.”

See also: A new breed of tech IPOs may give the stock market reason to party like it’s 1999

DraftKings went public via a merger with SPAC Diamond Eagle Acquisition Corp. and a gambling tech business, SBTech Global Ltd., earlier this year. The renamed DraftKings has been on a tear, gaining 258% in the year to date, even as major sports events were canceled during the pandemic.

Nikola merged with VectolQ Acquisition in June and immediately benefited from the cult status enjoyed by fellow electric vehicle maker Tesla Inc.
TSLA,
+2.78%

, which has propelled that stock to record levels this year. Nikola has gained 232% in the year to date.

See:Former House Speaker Paul Ryan to chair $300 million blank-check company: report

Virgin Galactic’s route to public markets came through a merger with Social Capital Hedosophia last October. The stock is up 35% in 2020, outperforming the S&P 500 ‘s
SPX,
-0.81%

5% gain and the Dow Jones Industrial Average’s
DJIA,
-0.56%

2% loss.

The recent crop of SPAC mergers have performed better than the broader group, the report found. The common shares of the 21 SPAC mergers completed in the period from Jan. 1 to July are averaging a return of 13.1% from their offer price, but that’s mostly due to the two highest performers — DraftKings and Nikola. Without those two, the SPACs produced better returns than in the period going back to 2015, but are still a negative 10.5%. That compares with the 2020 IPO market’s average aftermarket positive return of 6.5%.

The trend isn’t expected to end anytime soon. SPACs have raised a record $31 billion in 2020 to date, and new announcements are coming every day as investors seem to be racing to join the club. The year also brought the biggest-ever SPAC, when billionaire hedge-fund manager Bill Ackman took one public in July with more than $4 billion in its kitty to spend.

At the time, Ackman said he was “long-term bullish” on America and the stock market, although he was bearish on highly indebted companies.

James Gellert, chief executive of Rapid Ratings, a data and analytics company that assesses the financial health of private and public companies, said SPACs are a bull market phenomenon that gain in popularity when markets are doing well, as the stock market was until the recent selloff.

See: The ‘death of valuation’ and what it could mean for investors going forward

“There’s a lot of liquidity looking for nuanced asset classes and SPACs as a sub-category of equity is an interesting one to take a flier on,” he said. “If you have a diverse portfolio, a SPAC that is executed well is like a liquid private-equity investment.”

Many of the companies that are merged into SPACs come from private-equity portfolios, which usually means they are more mature businesses and in better financial health. For investors, they are really betting on the management team of the SPAC finding a good target business.

The broader initial public offering market is expected to be busy through the end of the year, with 45 companies in the current pipeline aiming to raise about $8 billion, according to Smith from Renaissance Capital.

See:Fisker is going public: Five things to know about the electric-car maker ahead of its IPO

Another 65 companies have filed confidentially with the aim of raising $28 billion, boosting the total to a potential 110 deals raising $36 billion.

So far this year, there have been 111 U.S. IPOs, raising $37 billion. The last year to see proceeds of more than that was 2014, when there were 275 deals that raised $85 billion.

“Even if we don’t get to that backlog of confidential filers, we’ll still probably exceed any year going back to 2014,” she said.

That was the year Alibaba Group Holding Ltd.
BABA,
-0.39%

went public, raising $25 billion in the biggest deal ever. That deal is expected to be eclipsed by the flotation of Ant Group, the payments company that was set up to serve Alibaba in 2004 and was spun off in 2011. Ant is expected to list on the Hong Kong and Shanghai exchanges later this year in a deal expected to raise up to $30 billion.

Smith said the pullback in stocks at the end of this week was a positive for the IPO market, “as it puts a bit more fear in the market. Fear gets better pricing, because multiples drop as peers drop and pricing falls,” she said.

Among the deals on tap are Palantir Technologies, the data-mining company backed by tech billionaire Peter Thiel; cloud data-warehouse company Snowflake Computing; videogame technology company Unity Software; Asana, a software provider started by Facebook; construction software company Bentley Systems; telehealth companies Amwell and GoodRx; packaging company Pactiv Evergreen Inc.; and Chinese online internet finance marketplace Lufax, among others.

The Renaissance IPO ETF
IPO,
-1.60%

has gained 49% in 2020 to date.



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AstraZeneca vaccine ‘most likely’ to roll out in the U.K. early next year


U.K. health secretary Matt Hancock on Monday said a COVID-19 vaccine would “most likely” be available in the first few months of 2021, as the country recorded a sharp rise in daily coronavirus cases.

Speaking on national news radio station LBC, Hancock said the government has already started production of the U.K. government’s initial order of 30 million doses of its coronavirus vaccine, which is being developed by pharmaceutical giant AstraZeneca
AZN,
-1.07%

in collaboration with the University of Oxford.

“We have got 30 million doses already contracted with AstraZeneca, in fact they are starting to manufacture those doses already, ahead of approval, so that should approval come through — and it’s still not certain but it is looking up — should that approval come through, then we are ready to roll out,” Hancock told LBC.

“The best-case scenario is that happens this year. I think more likely is the early part of next year — in the first few months of next year is the most likely,” he added.

U.S. President Donald Trump is reportedly considering plans to fast-track approval of AstraZeneca’s vaccine in a bid to make it available to Americans before November’s election.

The vaccine hasn’t been approved for use and is still undergoing late-stage clinical trials in the U.K., Brazil and South Africa.

Read:AstraZeneca coronavirus vaccine heads to late-stage study

Hancock’s comments come after the U.K. recorded a surge in the number of people testing positive for coronavirus. On Sunday, a further 2,988 cases of coronavirus were reported in the country, the highest number reported on a single day since May 22, and a rise of 1,175 on Saturday, according to the U.K. government’s coronavirus dashboard.

Two deaths were recorded within 28 days of a positive COVID-19 test in the previous 24 hours, taking the total to 41,551, the government said.

The rise in cases prompted Professor Gabriel Scally, a former National Health Service regional director of public health for the south west, to tell the Guardian that the government had “lost control of the virus.

Hancock on Monday denied the government was losing control, but said that this weekend’s rise in cases was “concerning.” He urged younger people to adhere to social distancing measures, saying that under-25s, particularly those aged 17 to 21, accounted for a large number of positive cases.

The spike in cases comes as people are returning to work and school, and as universities prepare to reopen.

“It is concerning because we have seen a rise in cases in France, in Spain, in some other countries across Europe — nobody wants to see a second wave here,” Hancock told LBC.

“It just reinforces the point that people must follow the social distancing rules, they are so important,” he said, adding, “But we’ve also bought vaccine ahead of it getting approved from a whole different series of international vaccines as well.”

Read:U.K. strikes two COVID-19 vaccine deals for 90 million doses

In August, the U.K. announced that it will buy 90 million doses of potential COVID-19 vaccines from Johnson & Johnson
JNJ,
-0.64%

and U.S. drug developer Novavax
NVAX,
-9.75%
.

Some people with coronavirus are being asked to travel hundreds of miles to get tested, according to the BBC.

Labour’s shadow health secretary, Jonathan Ashworth, on Sunday tweeted that the increase in COVID cases is “deeply worrying” and demanded Hancock give a statement to the House of Commons to explain the increase in cases and why some people are still being told to drive hundreds of miles to have a test.





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Renters in U.S. cannot be evicted through the end of the year due to coronavirus, CDC order states


The Centers for Disease Control and Prevention implemented a temporary eviction moratorium through the end of the year, protecting U.S. renters from losing their homes during the COVID-19 pandemic, the Trump administration announced Tuesday.

The CDC’s moratorium will apply to all rental units nationwide until Dec. 31 and goes into effect immediately, senior administration officials said of an unpublished CDC agency order. Treasury Secretary Steven Mnuchin told a U.S. House of Representatives panel Tuesday that the moratorium would cover around 40 million renters.

A previous federal eviction moratorium created by the CARES Act ended in late July and only applied to federally-funded housing, including rental units with mortgages backed by Fannie Mae
FNMA,
-1.33%

and Freddie Mac
FMCC,
-1.78%

. The moratorium will apply to any state in which there is not already a more protective ban in effect, according to the order. Multiple states have eviction moratoriums in place, including California, which established new rules in a late-night vote Monday.

Renters will be eligible for the moratorium’s protection if they received an economic impact payment, or stimulus check, as provided for by the CARES Act. Therefore, single renters must earn no more than $99,000 a year, while couples filing jointly can earn up to $198,000 annually.


Around 40 million people will be covered by the nationwide eviction moratorium, according to Treasury Secretary Steven Mnuchin.

The order, which was shared ahead of being published in the Federal Register on Sept. 4, includes a declaration for renters to sign and give their landlord. Senior Trump administration officials said the form would be made available on the CDC’s website.

Renters must indicate on the declaration that they cannot afford to pay their rent in full and that if evicted they would become homeless or force to move into congregate housing. Renters also must be able to prove that they made an effort to receive government assistance and that they could not afford rent.

The moratorium does not absolve renters of paying the rent. That money is still due to landlords, and senior administration officials said that renters should still attempt to make partial payments when they cannot afford to pay in full.

Landlords will still be permitted to evict tenants in certain cases, such as instances in which the tenant has destroyed property or poses a threat to the health or safety of neighbors.

The moratorium builds on a previous executive order from President Donald Trump that directed the Department of Health and Human Services and the CDC to determine whether halting evictions was necessary to contain the spread of the virus that causes COVID-19.

“In the context of a pandemic, eviction moratoria — like quarantine, isolation, and social distancing — can be an effective public health measure utilized to prevent the spread of communicable disease,” the CDC’s unpublished order said.

“President Trump is committed to helping hardworking Americans stay in their homes and combating the spread of the coronavirus,” White House deputy press secretary Brian Morgenstern said during a briefing Tuesday.


‘While an eviction moratorium is an essential step, it is a half-measure that extends a financial cliff for renters to fall off of when the moratorium expires and back rent is owed.’


— Diane Yentel, president and CEO of the National Low Income Housing Coalition

Housing advocates said the move was “long overdue,” but called for more help to be provided to renters facing financial difficulties amid historically high levels of unemployment caused by the pandemic.

“As we have said for five months, the very least the federal government ought to do is assure each of us that we won’t lose our homes in the middle of a global pandemic: The administration’s action would do so and will provide relief from the growing threat of eviction for millions of anxious families,” said Diane Yentel, president and CEO of the National Low Income Housing Coalition.

“But while an eviction moratorium is an essential step, it is a half-measure that extends a financial cliff for renters to fall off of when the moratorium expires and back rent is owed,” Yentel added, while calling on Congress to pass another COVID-19 relief bill with at least $100 billion in emergency rental assistance. Previously, some lawmakers and activists called for a cancellation of rent during the pandemic.

Trump administration officials during Tuesday’s briefing said that renters and landlords would have access to emergency funds already in place, including billions of dollars in grants from the Department of Housing and Urban Development and the $142 billion coronavirus relief fund from the Treasury Department.

Administration officials could not clarify whether the CDC moratorium would prevent eviction filings from occurring. Housing and legal advocates have raised concerns that landlords filed evictions against many people nationwide who should have been protected by the CARES Act moratorium.



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Here’s what could trigger more stock market pullbacks this year, says Schwab trading pro


A record-setting August for stocks has set the bar high, and September looks off to a promising start, at least for technology stocks, with electric-car maker Tesla
TSLA,
+12.56%

poised for more big gains.

That brings us to our call of the day from Schwab Center for Financial Research’s vice president of trading and derivatives, Randy Frederick, who thinks the stock market may finally deliver on some much-needed corrections.

“Obviously these things are difficult to pinpoint, but a 2%-3% decline sometime in the next couple of weeks wouldn’t be at all surprising to me. I continue to believe that the SPX
SPX,
-0.21%

[S&P 500] can reach 3,700 (+14.5%) by year-end, but probably not without three or four small pullbacks along the way,” he told MarketWatch in an interview and follow-up email.

“We haven’t had anything of that nature at all since going all the way back to early June, when we had that big drop-off. We’re clearly way overdue on that,” Frederick said. And while 3,700 sounds “pretty remarkable from a bottom-of-the-virus return,” on a year-to-date basis that 14% gain for the S&P 500 is fairly average, he noted.

When those smallish pullbacks come along, though, he advises against panic (he urged no panic in early March too), saying “they will be and should be used as buying opportunities.” That is because there is nowhere else for investors to put their money as any Federal Reserve interest rate increase is years out, said Frederick. And investors should learn from those who panicked out of the market in 2008 and missed out on an 11-year bull market, he added.

One potential correction trigger is technical, as he says 2020 has been closely tracking the action in 2009. That year saw three pullbacks — 3.5%, 4.3% and 5.6% in the last few months of 2009 — as his chart shows:

A “substantial pullback in earnings could also trigger a pullback,” he said, noting that second-quarter S&P 500 earnings per share came in far better than expected.

Frederick is watching the coronavirus pandemic as a potential trigger, with schools opening across the country and the potential for a dramatic uptick in the case count spooking markets, while trade issues with China shouldn’t be dismissed, as they also have the power to unhinge markets.

Another stick of dynamite for stocks is continued wrangling over enhanced unemployment benefits in the U.S. “That’s a big issue that needs to be resolved on what they should do to support workers and small business going forward,” said Frederick.

Read: Investors may be betting the wrong way on the U.S. election, says JP Morgan

The market

Nasdaq-100
NQ00,
+0.81%

futures are tearing higher, with Dow
YM00,
-0.10%
,
S&P
ES00,
+0.18%

futures up modestly. European stocks
SXXP,
+0.12%

are mixed, with the euro
EURUSD,
+0.42%

at a two-year dollar high. Gold
GC00,
+0.93%

and oil
CL.1,
+1.17%

are up, and Asian stocks were mixed.

The buzz

Tesla’s premarket climb has been slowed by news it will sell up to $5 billion worth of its stock. Also, an analyst said the electric-car maker is “fundamentally overvalued.”

Shares of Zoom
ZM,
+8.63%

are surging, after the videoconferencing group soundly beat forecasts. Companies paid up for the service.

Apple
AAPL,
+3.39%

reportedly ordered 75 million 5G iPhones, and shares are up.

Retailer Walmart
WMT,
-1.03%

is launching a $98 a year membership program offering fuel discounts and free shipping, to perhaps rival Amazon Prime
AMZN,
+1.44%
.

An update on manufacturing from U.S. purchasing managers, construction spending and automobile sales are ahead. China delivered stronger-than-expected manufacturing numbers.

President Donald Trump has defended his decision to visit Kenosha, Wis., on Tuesday, and offered up a defense of the teenager who shot two protesters. Democratic rival Joe Biden accused him of making things worse. A shooting in Los Angeles late on Monday has also drawn protesters.

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Belarusian opposition leader says protesters are vanishing.

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