New York – Stocks mostly end lower on Wall Street, giving the S&P 500 its third straight loss this week. The benchmark index slipped 0.2% on Thursday.
The rise in infections in Europe and new measures to contain the coronavirus in that country have motivated traders to withdraw money from riskier investments. European markets fell sharply after France imposed a curfew on many of its largest cities and Londoners faced new travel restrictions.
United Airlines fell after announcing that its revenues had fallen over the summer. Crude oil prices have fallen and Treasury yields have been mixed. Small-cap stocks resisted the downtrend and ended higher.
The market pullback was prolonged this week as optimism that Congress will propose another round of stimulus for the economy wanes and new data shows a further weekly increase in the number of Americans seeking employment. ‘unemployment assistance.
Technology, communications and healthcare stocks accounted for a large chunk of sales, outpacing gains in banking, real estate and other sectors.
Yields on Treasuries have been mixed, while the price of US crude oil has also fallen.
Shares rose mainly this month, but fell this week as Democrats-Republicans talks in Washington over another economic stimulus package dragged on, dampening investors’ hopes for a deal that could provide more money. short-term aid to the US economy. .
“The stimulus rhetoric continues to be a little negative, and the virus outbreak in Europe which is likely to cause more closures in various cities and countries, it’s also a little negative,” said Scott Wren, strategist. Global Market Principal, Wells Fargo Investment Institute.
Still, Wren added, the market expects Washington to provide another round of stimulus at some point, and continues to expect various efforts to develop treatments and vaccines for COVID- 19 are completed. If not, the recent pullback in equities would be much more severe, he said.
“The market is still pretty confident that we’re going to see good news on both fronts, but it doesn’t know when,” Wren said.
Sales eased in the afternoon as indices regained ground. The Dow Jones Industrial Average was down 28 points, or 0.1%, to 28,490 at 3 p.m. EST. The Dow Jones had lost 332 points at the start. The Nasdaq composite fell 0.7%. The Russell 2000 small-cap index rebounded from an initial decline and rose 0.8%.
The government’s latest weekly tally of unemployment compensation claims highlights how the economy continues to be hampered by the pandemic and recession that erupted seven months ago. The Labor Department said Thursday the number of Americans claiming unemployment benefits last week rose to 898,000, a historically high number that exceeds analysts’ forecasts.
The report follows recent data that pointed to a slowdown in hiring. The economy is still about 10.7 million jobs short of recouping the 22 million jobs that were lost when the pandemic struck in early spring.
The 10-year Treasury yield remained stable at 0.73%.
Investors continued to weigh the latest batch of corporate earnings reports in the US. Several reports so far have been better than expected, but the health crisis continues to cloud the outlook.
United Airlines fell 3.5% on Thursday after announcing that its revenue had fallen over the summer. Morgan Stanley rose 1.2% after the investment bank said its third quarter profit jumped 25% on higher trading income and higher fees. Walgreens Boots Alliance rose 4.9% after the drugstore chain’s latest quarterly results beat Wall Street forecasts.
Across the S&P 500, analysts expect companies to report a further decline in summer earnings from levels a year ago. But they expect the drop to be moderate from the nearly 32% fall in the spring, as the economy has shown signs of improvement.
A resurgence of coronavirus infections in Europe has also prompted investors to be cautious. There are fears that Europe may lack a chance to control the new outbreak, as infections reach record daily highs in Germany, the Czech Republic, Italy and Poland. France has imposed a 9 p.m. curfew on many of its largest cities and Londoners face new travel restrictions as governments take increasingly harsh measures.
The limits on public life are not as tight as the full lockdowns imposed in the spring, but will slow or even reverse the economic recovery after the recession, experts say.
European markets fell sharply after France imposed a curfew on many of its largest cities and Londoners faced new travel restrictions. The German DAX lost 2.5%. The CAC 40 in France fell by 2.1%. The FTSE 100 in London fell 1.7%.
On Thursday in Asia, the Shanghai Composite Index lost 0.3% to 3,332.18 and the Tokyo Nikkei 225 fell 0.7% to 12,827.82. Hong Kong’s Hang Seng lost 2.1% to 24,154.15.
Seoul’s Kospi lost 0.8% to 2,361.21 despite a strong start for the company that manages popular South Korean boy group BTS. The group is criticized by Chinese netizens after its leader thanked Korean War veterans for their sacrifices.
Big Hit Entertainment Ltd.’s share price doubled at noon, but ended the day near its opening. Its market value after an initial public offering that raised more than $ 800 million was around $ 7.5 billion.
In Sydney, the S & P-ASX 200 gained 0.5% to 6,210.30 while the Indian Sensex lost 1.2% to 40,293.61.
Thailand’s benchmark fell 1.5% after the government declared a “severe state of emergency” following a rally of protesters on Wednesday calling for democratic change.
AP business writer Joe McDonald contributed.