ASX 200 Weekly Wrap: ASX 200 has another shocker as US election approaches

The S&P/ASX 200 Index (ASX: XJO) has had another week of painful losses – in fact, its worst since late April. The 3.4% that the ASX 200 shed over the week translated into the index finishing up decisively under the 6,000-point threshold.

Last week's moves capped off a disappointing end to the month, with the ASX 200 losing close to 5% since 19 October.

The causes for this dramatic drop? There are 2 main factors in my opinion. Firstly, the number of coronavirus cases, whilst thankfully stable in Australia, has been rising on a global scale. Over in the United States, commentators are starting to call a 'third wave', as the number of cases has exploded over the past month or so. Over in Europe, France, Germany and the United Kingdom have recently gone into lockdown as well.

This situation obviously doesn't bode well for global growth and is one of the reasons I think the ASX 200 has been losing steam.

US election enters final stretch

Secondly, the US elections are just around the corner (this week in fact). Although polling is still indicating (and markets are still arguably pricing in) a loss for President Donald Trump and a Democratic win under Joe Biden, fears over a contested election or similar event have also been brewing over the past week as crunch time looms.

Markets hate uncertainty at the best of times. Thus, the prospect of severe political uncertainly and possible unrest in the world's largest economy (with the risks of the pandemic thrown in) isn't exactly a recipe for higher shares prices.

In ASX news, we also had a flurry of activity on the markets last week, despite the negative sentiment. Monday kicked things off with the news that Coca-Cola Amatil Ltd (ASX: CCL) has received a takeover offer from the European Coke bottler Coca-Cola European Partners PLC (NYSE: CCEP). This saw Amatil shares jump 16% on the day (more on that later).

Likewise, we saw embattled wealth manager AMP Limited (ASX: AMP) also receive some buyer interest from across the Pacific. AMP management confirmed on Friday that Ares Management Corp (NYSE: ARES) has issued an indicative, non-binding and (as yet) undisclosed takeover proposal for the Australian institution. Nevertheless, AMP shares ended almost 20% higher on Friday (again, more coming).

How did the markets end the week?

Not too well, as we've already flagged. The ASX 200 started the week at 6,167 points and ended up at 5,927.6 points for a week-to-week loss of 3.4%. But let's have a look at how the week panned out.

Monday started off small, with a loss of just 0.2%. But Tuesday saw the bears really step on the gas, leading the ASX 200 to a hefty 1.7% loss (its worst for the month so far). Wednesday saw something of a recovery, with a 0.1% raise, but this was quickly forgotten as Thursday brought another brutal sell-off with a 1.6% fall. Friday's more muted 0.55% fall sealed the deal for a week of heavy losses on the ASX 200.

Meanwhile, the All Ordinaries Index (ASX: XAO) also had a tough week, starting off at 6,373.7 points and finishing up at 6,113.2 points for a loss of 3.7% over the week.

Which ASX 200 shares were the biggest winners and losers?

Time for our Foolish equivalent of the old newspaper gossip pages. So stoke the fire and put the kettle on while we have a look at the biggest winners and losers for the week. As always, we'll start with the losers:

Tech and travel shares were the companies investors seemed to want to eject last week. But our week's wooden spoon goes to nickel producer Western Areas. Investors were hitting the sell button after the company downgraded its production guidance for FY2021 due to issues at one of its operations.

EML Payments wasn't too far behind with an 18.4% drop last week. No major news was out for this company, so we can only assume it got caught up with the broader tech sell-off and fell hard due to its previously strong gains over the month.

We can probably say the same for Zip Co, although investors have been cooling on this buy now, pay later company for a few weeks now.

As for Corporate Travel, I assume last week's hefty drop was due to a combination of negative sentiment from its recent annual general meeting, as well as the explosion of COVID cases around the world that we discussed earlier. That obviously isn't good news for a travel company.

With the losers out of the way, let's now check out last week's winners:

In a week of such heavy losses on the ASX 200, it is strange to see such healthy numbers in the winners' column!

The aforementioned Coca-Cola Amatil and AMP took out the gold and silver medals last week. With Amatil, prospective buyer Coca-Cola European Partners offered $12.75 per share in cash for the company, so investors were very keen to bump up the Amatil share price to within striking distance of this number.

And although AMP's takeover proposal from Ares hasn't got a price tag behind it yet, investors are very clearly excited about a possible exit door from the company — a sad day for a once-proud institution, if I may say so.

Meanwhile, Blackmores shares were on fire after last week's annual general meeting revealed the company is on course for profit growth in FY2021.

Finally, Resmed shares were in demand as the company delivered an unexpectedly strong quarterly update, thanks in no small part to strong demand for ventilators as a result of the pandemic.

What does this week look like for the ASX 200?

I'm not going to sugarcoat this: I think this week has the potential to deliver some extreme volatility to the share market in light of the US elections.

A strong result either way on Wednesday (our time) could well produce some relief-driven gains. It's possible we will get some idea of the outcome before market close on Wednesday, so put that in the calendar. However, I think investors should brace for the worst as we start the week. If the result is extremely close, we could be in for a very bruising few months, and the markets will (in my view anyway) not like this outcome at all. Whatever happens, I'm expecting a bumpy ride.

In other news, the Reserve Bank of Australia (RBA) is meeting on Tuesday for their monthly check-in. Most commentators are expecting the RBA to slash interest rates yet again to yet another all-time low, possibly 0.1%. Get ready to get even less bang for your buck from your saving account in November!

Finally, we'll be hearing from both Westpac Banking Corp (ASX: WBC) and National Australia Bank Ltd (ASX: NAB) next week when the banks deliver their full-year results. It will be interesting to see what these companies have up their sleeves in terms of dividends in particular.

But before we go, here's a comprehensive look at how NAB, Westpac and all of the ASX 200 blue chips are looking as we start the week: