US stocks fell earlier Wednesday, after a second consecutive record close for the Nasdaq Compound, as investors worried about rising coronavirus cases in many states and trade tensions between the United States and Europe.
How are the benchmarks working?
The Dow Jones Industrial Average DJIA,
it dropped 222 points, or 0.9%, to 25,935. The S&P 500 SPX,
It fell 19 points, or 0.6%, to 3,112. The Nasdaq COMP Compound,
it gave 8 points, or less than 0.1%, to trade at 10,124.
On Tuesday, the Dow Jones Industrial Average rose 131.14 points, or 0.5%, to close at 26,156.10, the S&P 500 Index gained 13.43 points, or 0.4%, ending at 3,131.29. The Nasdaq Composite Index rose 74.89 points, or 0.7%, to end at a new record of 10,131.37,
What is driving the market?
Recent data showed an acceleration of COVID-19 cases in the US. USA They could threaten the reopening of companies in some states, reducing appetite for stocks on Wall Street, as did a report that the Trump administration is considering imposing billions of import duties on Europe’s goods.
The 7-day average of new daily cases of COVID-19 increased more than 30% compared to a week ago, according to a CNBC analysis of data from Johns Hopkins University, while Bloomberg noted that coronavirus cases are on the rise. In Texas, Florida, Arizona, and California, some city and state officials are considering slowing down or reversing plans to reopen businesses.
The Wall Street Journal reported that Texas Governor Greg Abbott and Florida Governor Ron DeSantis are increasing enforcement of social distancing protocols, while California Governor Gavin Newsom, who saw more than 5,000 new cases and 3,700 on Tuesday. Hospitalizations have also been intensifying precautions to prevent a possible second wave of the disease.
On Tuesday, at a congressional hearing, public health expert Dr. Anthony Fauci described the increase in cases as “disturbing,” but said he was hopeful about a vaccine.
Read:Fauci says that in 40 years of dealing with viral outbreaks, he has never seen anything like COVID-19.
Meanwhile, a Bloomberg report that the United States is considering imposing tariffs on products from France, Germany, Spain, and the United Kingdom for about $ 3.1 billion, on products such as beer, gin, olives, and trucks, was also generating headwinds for the stock market because investors fear it could reignite a new trade war amid an economically damaging pandemic.
The United States was also considering re-imposing tariffs on Canada’s aluminum imports on July 1, as the new USMCA, or the United States-Mexico-Canada Agreement, which replaced the North American Free Trade Agreement, will take effect. .
The International Monetary Fund lowered its economic forecast for 2020, saying that the coronavirus pandemic has caused an unprecedented decline in global activity. The IMF reduced expectations of world economic growth for this year to negative 4.9%. That is almost two percentage points less than three months ago.
In 2021, world growth is expected to rebound at a growth rate of 5.4%, leaving the GDP level approximately 6.5 percentage points lower than pre-COVID-19 projections in January.
Looking ahead, investors are on the lookout for speeches by members of the Federal Reserve, including Chicago Fed President Charles Evans at 12:30 p.m. and St. Louis Fed President James Bullard. , at 2 pm, who on Tuesday said they are not seeing bubbles forming financial markets.
What actions are in focus?
Actions of Dell Technologies
Up 7.5% after the Wall Street Journal reported that the company was examining options, including a spin-off of its roughly $ 50 billion stake in VMware Inc., as the PC maker seeks to increase the value of its Actions.
Apple Inc. share AAPL,
They rose 0.4% as the Justice Department and state attorneys general are studying an investigation that would focus on the company’s App Store, according to a Politico report.
He said he would restructure about a tenth of his workforce as it addresses soft demand for higher-priced DIY services and the continuing uncertainties stemming from the COVID-19 pandemic. Its shares fell 0.6%.
GNC Holdings Inc. CNG
He filed for bankruptcy Tuesday night as he hopes to accelerate his plan to close at least 800-1,200 of his stores. Shares of the vitamin and wellness supplement retailer fell 5.8%.
How did other assets perform?
West Texas US Intermediate Crude CLQ20,
It fell 86 cents, or 2.2%, to trade at $ 39.50 a barrel on the New York Mercantile Exchange. In precious metals, gold futures extended their gains after hitting an eight-year high on Tuesday, with August contact GCM20,
increasing $ 5.00, or 0.3%, to reach $ 1,787.00 an ounce.
The 10-year Treasury note yields TMUBMUSD10Y,
It rose 2 basis points to 0.730%. Bond prices move inversely to yields.
The dollar was up 0.3% against a basket of its major rivals, based on trading in the ICE US Dollar index. DXY
In global equities, the Stoxx Europe 600 SXXP Index,
It fell 1.5% as concerns about a new tariff dispute put investors on edge.
In Asian markets, China’s benchmark CSI 300 index 000300,
rose 0.4%, the Japanese Nikkei Nikki,
down 0.1%, Hang Seng HSI of Hong Kong,