Tags: Coronavirus | wall street | stock | market | dow | nasdaq | s&p 500

S&P 500, Nasdaq End Lower After Sharp Drop in Tech Titans

S&P 500, Nasdaq End Lower After Sharp Drop in Tech Titans
(G0d4ather/Dreamstime)

Monday, 13 July 2020 04:05 PM

 The S&P 500 and Nasdaq ended lower on Monday, pulled down by Amazon, Microsoft and other recent big-name leaders of Wall Street's recent rally. The S&P 500 dipped after briefly touching its highest level since Feb. 25. The index has rebounded over 40% since mid-March, even as COVID-19 infections rose rapidly in Arizona, California and Texas and about 35 other states.

Stocks that outperformed in recent months, including Amazon , Microsoft, Nvidia and Facebook , ended down more than 2% after gaining earlier in the day.

"The rally's been driven by a handful of names. You've had headlines about COVID and layoffs and the economy. It's finally caught up with these names everybody's been hiding in," said Michael O'Rourke, chief market strategist at JonesTrading in Stamford, Connecticut.

Tesla dropped 3.1% after surging 16% earlier in the session. The electric car maker's stock has been on a blistering rally over the past two weeks as investors bet the electric car maker could report a quarterly profit and potentially join the S&P 500.

Shares of German biotech firm BioNTech jumped over 10% and Pfizer Inc climbed 4% as two of their experimental coronavirus vaccines received the U.S. FDA's "fast track" designation.

Merger news also perked up investors as chipmaker Analog Devices Inc announced a $21 billion deal to buy rival Maxim Integrated Products Inc, sending its stock 8% higher. Analog shares fell 5.8%.

PepsiCo Inc gained 0.3% after it said it benefited from a surge in at-home consumption of salty snacks such as Fritos and Cheetos during lockdowns.

The Cboe Volatility Index, Wall Street's fear gauge, closed at its highest level since June 26. Its 4.9-point gain for the session was its largest since June 11.

Investors are bracing for what could be the sharpest drop in quarterly earnings for S&P 500 firms since the financial crisis, according to IBES Refinitiv data. Results from big banks will be in focus this week.

On Wall Street, the Dow Jones Industrial Average rose 10.5 points, or 0.04%, to 26,085.8, the S&P 500 lost 29.82 points, or 0.94%, to 3,155.22, and the Nasdaq Composite dropped 226.60 points, or 2.13%, to 10,390.84.

Recent economic data has strengthened belief that the stimulus-pumped U.S. economy is on the road to recovery, helping investors look past a recent spike in U.S. infections.

Declining issues outnumbered advancing ones on the NYSE by a 1.56-to-1 ratio; on Nasdaq, a 2.11-to-1 ratio favored decliners.

The S&P 500 posted 38 new 52-week highs and no new lows; the Nasdaq Composite recorded 128 new highs and 22 new lows.

Volume on U.S. exchanges was 11.6 billion shares, compared with the 11.9 billion average for the full session over the last 20 trading days.

GLOBAL MARKETS

World equity benchmarks reversed course after hitting a five-month peak on Monday while safe-haven U.S. government bonds and gold gained, as optimism about a global economic recovery was overtaken by renewed fears amid record numbers of new coronavirus cases in the U.S.

MSCI's gauge of stocks across the globe briefly touched its highest level since February before ending down 0.29%.

"Equity indices are clearly trying to look through into Q3 and beyond, but with the U.S. struggling to shake off the coronavirus phase one, this should be factored into equity risk premia," Raymond James European strategist Chris Bailey said.

Losses accelerated in U.S. afternoon trading after California ordered new lockdown measures, including shutting bars and banning indoor dining at restaurants statewide to combat the surge in infections. School districts in Los Angeles and San Diego announced they will offer online-only instruction in the fall.

The stock market reversal helped the dollar pare losses, finishing down less than 0.1% against a basket of major currencies. The euro, meanwhile, rose 0.5% to $1.135 to maintain its slow uptrend since late last month. Looming large for the common currency was a planned EU summit on July 17-18, where leaders need to bridge gaps on long-term budget and economic stimulus plans.

"If an agreement weren't to be reached there, then they still expect one within weeks. It's worth remembering that there are a number of complex issues to be worked out," Deutsche Bank strategist Jim Reid said.

Investors continued to seek the perceived safety of government bonds. Benchmark 10-year notes last rose 3/32 in price to yield 0.6234%, down from 0.633% late on Friday.

Super-low rates have been a boon for non-yielding gold, which hovered near nine-year highs after five straight weeks of gains. Spot gold added 0.2% to $1,802.45 an ounce. U.S. gold futures gained 0.38% to $1,811.00 an ounce.

U.S. crude recently fell 2.32% to $39.61 per barrel and Brent was at $42.28, down 2.22% on the day

© 2020 Thomson/Reuters. All rights reserved.


   
1Like our page
2Share
StreetTalk
The S&P 500 and Nasdaq ended lower on Monday, pulled down by Amazon, Microsoft and other recent big-name leaders of Wall Street's recent rally.
wall street, stock, market, dow, nasdaq, s&p 500
777
2020-05-13
Monday, 13 July 2020 04:05 PM
Newsmax Media, Inc.
 

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved