[ad_1]
The major index fell sharply on the New York Stock Exchange.
Disappointment with the results of the Federal Open Markets Commission (FOMC) and the possibility of forced sales of shares due to losses from short sales of some hedge funds are believed to have put pressure on investors.
On the 27th (US time) on the New York Stock Exchange (NYSE), the Dow Jones 30 industrial average closed at 30,303.17, a sharp drop of 633.87 points (2.05%) from the battlefield.
The Standard & Poor’s (S&P) 500 Index closed 98.85 points (2.57%) from the battlefield at 3,750.77, while the Nasdaq index of technology stocks fell 355.47 points (2.61%) to 13,270.60.
The S & P500 index showed all of this year’s gains.
The Dow index posted the biggest drop on the day since late October last year.
The market watched the results of the FOMC, the performance of large companies like Apple and the aftermath of rapid fluctuations in the prices of some stocks like Gamestop.
The leading index was unstable from the start of the market.
Before the performance announcements from major tech companies like Apple, Tesla and Facebook, the stock prices of those companies have already risen significantly, creating a level burden.
Furthermore, sharp fluctuations in the share price of Gamestop, an American gaming-related retailer, and AMC, a chain of cinemas, made the overall market unstable.
The share prices of these companies are rising as individual investors have recently shown a strong buying trend targeting Gamestop and AMC.
There was also news that some hedge funds, such as Melvin Capital, which took a short selling position with the company, were unable to overcome the individual’s buying bias and pulled their short positions.
Gamestop’s share price soared around 134% that day.
AMC shares soared about 300%.
The problem is that a hedge fund that suffered massive losses from its short short position could be forced to sell other shares it owns to make up for the loss.
In the market today, a diagnosis was spilled that the movement of forced sale of shares by hedge funds due to losses of short sales was being detected.
The Federal Reserve System (Fed and Fed) also failed to calm the market disturbances.
The Fed did not change interest rates or asset purchases as expected by the FOMC that day.
There were no changes in the policy orientation.
Fed Chairman Jerome Powell reiterated his position that it is early to discuss tapering (reduction of bond purchases) and that he will fully inform the market before gradually reducing and implementing it.
Although President Powell has reduced concerns about premature tapering, the market has expressed disappointment that the possibility of further relaxation has not been clearly presented.
The Fed assessed that the recent economic recovery has slowed down, but expressed the view that the medium-term economic outlook has improved somewhat.
The major indices expanded further after the FOMC results and President Powell’s press conference.
Continued concern over the disruption in the supply of a new vaccine against coronavirus infection (Corona 19) also made investors uneasy.
Points are constantly being raised that the vaccine supply may not be fluid as AstraZeneca is expected to supply less than the planned supply to Europe.
White House spokeswoman Jen Saki wants a strong and clear investigation into the Corona 19 origin theory in China, and the view that it is necessary to restrict the use of Chinese products like Huawei is also a factor that hampered sentiment. investor.
In the first days of taking office, the Biden administration is raising concerns that the recovery of bilateral ties will not be easy, with a tough message every day for China.
Meanwhile, Boeing’s stock price fell 4% that day.
Results were slow, with losses in the fourth quarter far greater than market expectations.
All industries fell by industry on this day.
Communication fell 3.82% and industry leaders also fell 2%.
The economic indicators published that day were also slow.
The US Department of Commerce announced that December durable goods orders increased 0.2% from the previous month.
Compared to the 1.2% increase in November, the increase has decreased significantly.
It fell short of the 0.8% rise in the market forecast compiled by The Wall Street Journal.
Experts from the New York stock market raised concerns about vaccine supply delays.
“The delay in vaccine supply and continued containment measures are a double whammy for investors,” said Hani Redha, portfolio manager at Finebridge Investments. “I think the market was expected to discuss mitigation rather than strengthen containment at this point,” he said.
On the Chicago Options Exchange (CBOE), the volatility index (VIX) rose 61.64% from the previous trading day to 37.21.
/ yunhap news
