Tag: Dow

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Dow falls 200 points, notches its fifth straight week of losses as Russia-Ukraine war drags on

Dow falls 200 points, notches its fifth straight week of losses as Russia-Ukraine war drags on

The Dow Jones Industrial Typical fell on Friday and notched its fifth straight week of losses as traders continue to be cautious about the war between Russia and Ukraine.

The Dow fell 229.88 details to 32,944.19, dragged down by losses in Nike and Apple. The S&P 500 fell 1.3{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} to 4,204.31. The technological innovation-concentrated Nasdaq Composite fell 2.2{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} to 12,843.81.

Russian President Vladimir Putin mentioned Friday that “particular good shifts” have occurred in the talks amongst the Kremlin and Ukraine. Nonetheless, a ceasefire has not been negotiated. Meanwhile, President Volodymyr Zelenskyy reportedly claimed Ukraine has reached a “strategic turning place” in its war with Russia.

U.S. President Joe Biden also known as for an conclude to Russia’s status as a desired trade companion, although Congress passed a funding bill that consists of $14 billion of Ukraine aid.

“Stocks are looking at an additional red week, as hope for a ceasefire, only to be let down, has added to the uncertainty,” stated Ryan Detrick of LPL Financial.

The Dow posted a 5-day getting rid of streak, as the Russia-Ukraine war proceeds to be an overhang on economical marketplaces. The S&P and Nasdaq fell for a 2nd straight 7 days.

For the 7 days, the Dow lost 2{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}. In the meantime, the S&P fell 2.9{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, and the Nasdaq slid 3.5{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} this week.

“Probably great news from favorable feedback relating to cease fireplace negotiations from Putin but buyers are doubtful how considerably pounds to put on this presented some of his former comments which turned out to be hollow,” reported Jim Paulsen, chief investment strategist for the Leuthold Group.

Nevertheless, Bank of America mentioned Friday that inventory declines associated to the war could have bottomed.

“The S&P 500’s -12{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} drop from its peak indicates a great deal of the froth has been taken out,” claimed Savita Subramanian, equity and quant strategist at Financial institution of The united states Securities. “Shares are mostly pricing in the geopolitical shock, in which the S&P 500 fell 9{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} from peak-to-trough given that Russia-Ukraine headlines in early Feb, equivalent to a typical 7-8{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} drop in prior macro/geopolitical events.”

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The moves arrived amid a further day of better electricity charges. West Texas Intermediate crude, the U.S. benchmark, rose 2.9{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} to around $109 for every barrel, while worldwide common Brent crude moved 2.9{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} larger to around $112. To be absolutely sure, crude costs are well off the highs noticed before in the 7 days.

Metals costs except for copper fell sharply. Palladium futures tumbled 4{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} to $2,803.50 an ounce. Agricultural commodity selling prices turned mixed and bond yields had been largely higher, nevertheless only a bit.

On the data front, the University of Michigan consumer sentiment index sunk to 59.7 in March, down from 62.8 in February, according to the report unveiled on Friday. This marks the weakest print considering that September 2011.

“Information that buyer self confidence sunk even lower this morning as residence fears about inflation intensify have ramped up worries about a severe U.S. economic slowdown or potentially even a recession,” added Paulsen.

Elsewhere, Rivian slipped 7.6{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} right after lacking estimates for the fourth quarter on the best and base strains, even though DocuSign sank 20.1{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} immediately after issuing weak guidance for the to start with quarter and fiscal calendar year.

Specific tech names dragged on the Nasdaq on Friday and ongoing their weak point considering the fact that Monday. Zoom Video fell 5{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, bringing its weekly losses to almost 10{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}. Meta Platforms fell 3.9{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} and lost 6.2{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} for the 7 days.

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Dow climbs about 800 points in its best day since late 2020 as investors weigh latest on Russia-Ukraine

Dow climbs about 800 points in its best day since late 2020 as investors weigh latest on Russia-Ukraine

Stocks climbed Friday, developing on Thursday’s rally, as traders continued to assess the financial challenges stemming from Russia’s invasion of Ukraine.

The Dow Jones Industrial Common added about 790 details, or 2.4{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}. The blue-chip average is on monitor for its very best working day since late 2020. The S&P 500 gained 2{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}. The Nasdaq Composite rose 1.4{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}.

Shares are coming off a whipsaw investing session Thursday in which the major indexes staged a substantial comeback from steep declines earlier in the working day. The Dow on Thursday erased a far more than 800-level decline to close better.

“Investors who have anticipated elevated volatility in 2022 swiftly came into the market and you happen to be seeing follow-by right now,” Jeff Kilburg, main expenditure officer of Sanctuary Prosperity, explained. “We have been in an oversold affliction. There was an overreaction in the fairness markets to the Ukraine crisis.”

For the week, the Dow is marginally decrease although the S&P 500 and the Nasdaq Composite are good.

Shares of Johnson & Johnson and 3M had been the prime gainers of the Dow on Friday, introducing additional than 4{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} just about every. Etsy shares led the S&P 500 on Friday, growing close to 15{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} following the online marketplace’s quarterly final results defeat analyst estimates.

Shares of Further than Meat tumbled extra than 8{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} after a disappointing earnings report. Foot Locker shares plunged about 30{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} right after the retailer stated 2022 profits will fall as it expects to offer less Nike merchandise.

Market place sentiment got a enhance Friday after the Kremlin reportedly stated that Russian President Vladimir Putin is ready to send a delegation to Belarusian money Minsk for negotiations with Ukraine.

Russia is closing in on the money city of Kyiv, in accordance to Ukrainian officials. The funds experienced been strike by “horrific Russian rocket strikes,” Ukrainian Overseas Minister Dmytro Kuleba claimed.

European Union leaders are talking about imposing sanctions on any European belongings held by Putin and Overseas Minister Sergey Lavrov, two resources explained to CNBC’s Silvia Amaro. It is not very clear irrespective of whether Putin or Lavrov have any significant belongings in the EU.

President Joe Biden on Thursday rolled out a wave of sanctions versus Russia in a wide hard work to isolate Moscow from the world wide economic climate.

“There is certainly chaos on the ground, but you will find clarity on sanctions, and I consider that is in which the industry is using some convenience,” explained Jeff Kleintop, chief worldwide financial commitment strategist at Charles Schwab.

On the details front, the main personalized intake expenditures selling price index, the Federal Reserve’s principal inflation gauge, rose 5.2{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} from a yr in the past, the Commerce Division claimed Friday. Economists surveyed by Dow Jones predicted a 5.1{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} print.

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The Nasdaq Composite is still in correction, or down additional than 10{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} from its record significant. The Dow and S&P 500 are just outdoors of correction territory.

“It is a headline-driven current market, and as we get some resolution and see what transpires with Russia and Ukraine, the concentrate will be back again on the Fed all over again,” Bespoke Investment’s Paul Hickey told CNBC’s “TechCheck” on Friday.

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Dow ends lower, dashes hopes for a turnaround Tuesday

Shares resumed their selloff for most of working day, but the Dow made available a glimmer of hope for turnaround Tuesday when it briefly turned environmentally friendly in the afternoon.

But even while stocks finished off their lows, the main indexes all ended in the red.

The Dow (INDU)completed a average .2{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} or 67 points lower, possessing swung a lot more than 1,000 factors from high to very low-place for the second straight session in a row.
Dow parts American Express (AXP), Johnson & Johnson (JNJ) and IBM (IBM) all posted sturdy outlooks in their earnings releases, serving to direct the index again from its worst losses.
The S&P 500 (SPX) completed down 1.2{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} but again prevented the dreaded correction territory, described as a 10{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} drop from the most new peak. In the circumstance of the S&P, that was just a few months ago, when it hit a history high on January 3.
The Nasdaq Composite (COMP), which fell into correction territory very last week, closed down 2.3{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}.
The market’s volatility tracker, the CBOE Volatility Index (VIX), or Vix, also reflected the roller coaster-character of the working day and finished up 2.2{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, getting recovered from its earlier double-digit share bounce. Amid all this, CNN Business’ Concern and Greed Index fell solidly into “dread” manner Tuesday, as investors grew nervous about the Fed’s plan variations and world-wide politics.
Shares climbed just about unabated in 2021, and some specialists think the market was thanks for a pull-back again as stocks acquired costly. On Monday, the Dow fell more than 1,000 factors at its lowest point but finished in the eco-friendly thanks to a very last minute reversal just just before the current market shut.

“The latest rate action indicates the long overdue equity marketplace correction has lastly started. In our perspective, this is a nutritious extended-expression progress,” explained Steven Ricchiuto, US chief economist at Mizuho Securities.

For worth hunters, the recent selloffs may possibly existing an opportunity “to start off nibbling at some of the far more overwhelmed down regions of the market place,” he extra.

What is actually driving markets

Buyers have a whole lot on their plate proper now.

The Federal Reserve’s conference is kicking off ahead of Wednesday’s plan final decision. Despite the fact that Fed Chairman Jerome Powell has not manufactured a top secret of the central bank’s programs to roll back again stimulus and raise desire rates this 12 months, it is really stressing traders out.

The central financial institution in December signaled several price hikes in 2022 and expectations settled on a few a single-quarter percentage position will increase. But given that then, the marketplace has shifted its anticipations to as quite a few as four hikes.
Treasury bond yields, which observe interest charge expectations, ticked increased on Tuesday, with the 10-yr bond yielding 1.79{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} at the time of the inventory sector near. Previous week, the produce experienced climbed previously mentioned 1.8{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} for the 1st time since the pandemic began, signaling that the market is gearing up for a rising desire fee planet.

The Fed’s anticipated actions arrive in reaction to rampant pandemic-period inflation. Economists and buyers fear when will rates have soared so a lot that Americans cease investing — a horrible indicator for the restoration.

Purchaser self-confidence fell a little in January, info from The Conference Board confirmed Tuesday, but it was even now much better than economists experienced envisioned. American’s check out of the current condition improved even however limited-phrase advancement anticipations declined.

“Issues about inflation declined for the second straight thirty day period, but keep on being elevated following hitting a 13-yr large in November 2021,” reported Lynn Franco, senior director of economic indicators at The Convention Board. “Issues about the pandemic enhanced a little bit, amid the ongoing Omicron surge.”

With earnings time in complete swing, buyers want to listen to how a great deal of the production price tag improves corporations can go onto their buyers.

The cherry on major of the problems is the problem concerning Russia and Ukraine. Tensions are mounting whilst traders are attempting to determine out how to cost in a possible invasion of Ukraine.
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Dow drops 450 points as bond yields surge, Goldman Sachs leads losses

The key averages fell sharply Tuesday soon after Goldman Sachs claimed disappointing earnings and as government bond yields hit Covid-era highs.

The Dow Jones Industrial Ordinary slipped by about 450 details, or 1.24{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}. The S&P 500 fell 1.5{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, and the Nasdaq Composite declined 2{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, hitting its lowest degree in 3 months. U.S. marketplaces were being closed Monday owing to the Martin Luther King holiday getaway.

Goldman Sachs shares ticked much more than 7{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} reduced on Tuesday following the bank skipped analysts’ anticipations for its fourth-quarter earnings. Goldman’s running bills surged 23{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} on elevated pay out for Wall Avenue personnel.

Meanwhile, Treasury yields posted strong gains. The closely watched 2-year yield broke previously mentioned 1{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} for the initially time given that February 2020, the thirty day period ahead of the pandemic declaration that despatched the U.S. financial system into economic downturn. The 2-12 months Treasury is seen as a gauge of where the Federal Reserve will set short-time period borrowing rates.

Charges rose along the yield curve, with the benchmark 10-calendar year be aware hitting 1.86{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, its highest because January 2020. The 10-yr yield started off 2022 all around 1.5{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}.

“The bond marketplace is continuing to selling price in a additional aggressive coverage tightening by Federal Reserve centered on nonetheless-higher inflation and the Fed’s far more hawkish guidance,” mentioned Kathy Bostjancic, the Main US Economical Sector Economist at Oxford Economics.

“A rather intense Fed tightening route will lead to relatively reduced valuations as economic climate-broad progress ought to slow as the Fed attempts to soften the pace of desire,” Bostjancic extra.

Elsewhere, Microsoft dipped 1.7{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} immediately after asserting the computer software huge will invest in video activity corporation Activision Blizzard in an all-cash transaction valued at $68.7 billion. Shares of Activision Blizzard surged 25{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}.

Retailer Hole shares fell more than 8{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} following Morgan Stanley downgraded the retailer.

Know-how stocks declined on Tuesday, continuing their downward trend in 2022 as interest premiums increase. Higher charges usually damage growth pockets of the market place that depend on lower premiums to borrow for investing in innovation. And their future earnings glance a lot less desirable when charges are spiking.

Tesla dropped 2.5{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} on Tuesday. Meta Platforms and Amazon fell 3.7{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} and 2.5{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, respectively.

The shortened trading week will characteristic quarterly experiences from 35 companies in the S&P 500, such as Financial institution of The usa, UnitedHealth and Netflix.

Significant financial institutions Wells Fargo, JPMorgan Chase and Citigroup kicked off the earnings time on Friday, with the a few businesses submitting far better-than-expected earnings. Nevertheless, the market’s reaction to individuals benefits was blended. Wells Fargo shares posted a acquire on the back again of all those results, but JPMorgan Chase and Citigroup slid.

Over-all, 26 S&P 500 companies have noted calendar fourth-quarter earnings thus much, in accordance to Refinitiv. Of those corporations, virtually 77{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} posted base-line outcomes that beat analyst anticipations.

“Current economic information is further more confirming the financial state is in fact slowing owing to omicron. Retail income, consumer confidence, industrial production, and the Empire State producing all explained to a very similar tale, our economic system is slowing and anxieties are rising,” claimed Ryan Detrick of LPL Economic. “This just isn’t the close of the world while, as we be expecting any around-term slowdown of output to merely be pushed again to further quarters when the omicron anxieties subside.”

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The unfold of the omicron Covid-19 variant has raised issues more than the state of the international financial restoration at any time since information of its discovery broke. Some nations and areas reinstated lockdowns and other social distancing measures to curb the outbreak.

Having said that, latest details implies the distribute may perhaps be easing. In New York the 7-working day normal of day by day new conditions has been slipping considering that hitting a file earlier this month, according to facts compiled by Johns Hopkins College. In Maryland, daily infections are down 27{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} week around 7 days. Instances are also slipping in South Africa and the United kingdom.

Rocky start off to the yr

The newest moves come as equities have struggled to start out 2022.

The Dow, S&P 500 and Nasdaq Composite are all down for the year amid problems more than the the latest inflationary surge and the prospect of tighter monetary plan from the Federal Reserve.

Philadelphia Fed President Patrick Harker informed CNBC very last week that the central bank could increase prices a few or 4 instances this calendar year. He noted that inflation is “extra persistent than we imagined a even though back.”

Tech, the largest S&P 500 sector by current market cap, has been hit in particular difficult this 12 months, falling additional than 4{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}. Significant Tech names like Meta Platforms, Amazon, Netflix, Alphabet and Apple are all down year to date.

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Dow tumbles more than 500 points to end a volatile week, S&P 500 sheds 1{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}

U.S. shares came underneath strain again in Friday’s unstable session amid concerns about tighter financial policy and the ongoing pandemic, leading to a dropping week for the big averages.

The Dow Jones Industrial Ordinary dropped 532.20 factors, or 1.5{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, to 35,365.44. The S&P 500 fell 1{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} for a 2nd down working day to 4,620.64. The tech-large Nasdaq Composite finished the session much less than .1{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} decrease at 15,169.68 after briefly investing in the inexperienced. At its session minimal, the Nasdaq dropped about 1.5{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}.

The main averages posted a negative week with the Nasdaq currently being the largest loser. The tech-weighty benchmark declined approximately 3{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, even though the Dow and the S&P 500 slipped 1.7{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} and 1.9{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, respectively.

Friday coincided with the expiration of stock solutions, index choices, inventory futures and index futures — a quarterly celebration recognised as “quadruple witching” that usually arrives with heightened volatility.

The S&P economical sector was the biggest laggard on Friday with a 2.3{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} reduction soon after financial institution stocks outperformed in the past session. Goldman Sachs dropped virtually 4{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, although Lender of The us and JPMorgan both equally missing around 2{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}.

Numerous mega cap tech shares registered steep losses this 7 days. Microsoft dipped .3{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} Friday, bringing its weekly drop to approximately 5.5{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}. Alphabet and Apple fell extra than 4{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} this week.

Shares of a person-time EV darling Rivian tumbled far more than 10{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} Friday soon after the truck maker explained it will drop small of its 2021 creation focus on.

Investors appeared to be rotating from high-expansion tech names to client staples, as they ongoing to digest the most recent shift by the Federal Reserve along with climbing inflation and the spread of the omicron Covid variant.

“As the Federal Reserve turns additional hawkish and expectations for larger curiosity costs rise, traders are reducing publicity to expansion shares,” mentioned Jim Paulsen, chief expenditure strategist at The Leuthold Team. “Ordinarily, expansion shares exhibit a larger length when compared to value stocks because a greater proportion of their money flows will be received in the additional distant long run.”

FedEx shares jumped practically 5{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} immediately after quarterly earnings and income results topped expectations and it declared a $5 billion buyback. The shipper also reinstated its first 2022 EPS forecast.

Covid-19 vaccine makers Moderna and Pfizer notched weekly returns of 14.7{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} and 12.7{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, respectively, earning them standouts in the S&P 500.

Earlier this week, the Fed introduced a additional intense program to wind down its asset buys, and that it is seeking at mountaineering rates many occasions in 2022.

“Investing will keep on being pretty choppy for the rest of the 12 months as investors grapple with falling buying and selling volumes about the coming classes,” said Edward Moya, senior market analyst at Oanda.

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Dow plunges 905 points in Black Friday selloff, books worst day in over a year as WHO declares new COVID ‘variant of concern’

U.S. stock benchmarks suffered withering losses on Friday as stock and commodity markets plunged, after scientists detected a new COVID variant in South Africa that could be to blame for a recent sharp surge in cases, especially in Europe.

U.S. markets were closed for Thanksgiving on Thursday and ended at 1 p.m. Eastern Time on Friday, three hours earlier than usual, and bond market trading ends at 2 p.m., an hour earlier than is typical.

How are stock-index futures trading?
  • The S&P 500
    SPX,
    -2.27{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}
    fell 106.84 points, or 2.3{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, to 4,594.62.

  • The Dow Jones Industrial Average
    DJIA,
    -2.53{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}
    slumped 905.04 points, or 2.5{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, to 34,899.34, with the index logging the worst daily drop since Oct. 28, 2020, according to FactSet data.

  • The decline for the Dow saw it mark its first close below its 50-day moving average at 35,261.93 since Oct. 14.

  • The Nasdaq Composite Index COMP declined 353.57 points, or 2.2{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, to15,491.66.

  • The decline for the S&P 500, Dow and Nasdaq Composite posted their worst Black Friday performance since 1950.

On Wednesday, the Dow industrials
DJIA,
-2.53{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}
fell 9.42 points to finish nearly flat at 35,804.38. The S&P 500
SPX,
-2.27{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}
slipped 0.2{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} to close at 4,701.46, just 0.1{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} below its Nov. 18 record close of 4,704.54, according to Dow Jones Market Data. The Nasdaq Composite Index
COMP,
-2.23{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}
rose 0.4{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} to 15,84.23.

What’s driving the market?

It was an ugly day for stock investors during a thinly traded Black Friday session, which was susceptible to big swings on alarming news from public health officials who were assessing a new variant of the coronavirus that causes COVID-19.

Late in the session, the World Health Organization’s technical advisory group assigned the B. 1.1.529 variant of the virus the Greek letter omicron and declared it a “variant of concern,” as it did with the delta variant.

Fear of a new variant overshadowed the usual focus on U.S. Black Friday shopping day, which puts the focus on retailers as consumers shop for bargains.

Particularly notable about the variant is the “large number of mutations, some of which are concerning,” the WHO group said in a statement. The mutations could make omicron more resistant to the current batch of vaccines.  

The discovery of the new COVID strain was announced on Friday by South Africa’s health minister Joe Phaahla. He said scientists were concerned because of its high number of mutations and the dramatic surge in infections the country had seen over the past four or five days.

“The pandemic and COVID variants remain one of the biggest risks to markets, and are likely to continue to inject volatility over the next year(s),” wrote Keith Lerner, co-chief investment officer and chief market strategist at Truist Advisory Services, in a Friday note. “It’s hard to say at this point how lasting or impactful this latest variant will be for markets,” the analyst wrote. 

The omicron strain has been detected in Botswana and in Hong Kong in travelers who had visited South Africa.

“The one bull in the China shop that could truly derail the global recovery has always been a new strain of Covid-19 that swept the world and caused the reimposition of mass social retractions,” said Jeffrey Halley, senior market analyst, at OANDA, in a note. “All we know so far is the B. 1.1.529 is heavily mutated but markets are taking no chances.”

“Just when you thought Covid was being controlled in a holiday shortened week,” said Sam Stovall, chief investment strategist at CFRA Research, in emailed comments.

“‘It makes sense to have a market significant correction given the high level of uncertainty.’”


— Jay Hatfield, CEO and portfolio manager at Infrastructure Capital Management

Trading around the Thanksgiving holiday is often associated with lower trading volumes as traders typically wait until Monday to return to work. There was no U.S. economic data on the calendar for Friday.

After new cases stabilized at 200 a day, South Africa reported more than 1,200 on Wednesday and 2,465 on Thursday.

The U.K. government is banning flights from South Africa along with five other African nations, effective Friday.

“Predictably, energy, travel related and financials are the leading decliners and treasuries are rallying,” wrote Jay Hatfield, CEO and portfolio manager at Infrastructure Capital Management, in emailed comments on Friday.

“It makes sense to have a market significant correction given the high level of uncertainty,” the money manager wrote.

“At this stage very little is known,” Deutsche Bank strategists, led by Jim Reid, told clients in a note. “Mutations are often less severe so we shouldn’t jump to conclusions but there is clearly a lot of concern about this one. Also South Africa is one of the world leaders in sequencing so we are more likely to see this sort of news originate from there than many countries. Suffice to say at this stage no one in markets will have any idea which way this will go.”

Read: Facing the biggest inflation surge in 30 years, shoppers expect to spend a lot more this holiday season

Which companies are in focus?
  • Drugmaker stocks were on the rise, including Pfizer PFE advanced by 6.1{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, and Moderna MRNA stock rallied by about 21{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}.

  • Travel-related stocks were on the backfoot: Expedia EXPE fell nearly 9,5{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}

  • Shares of airliners and cruise ships Delta Air Lines DAL, fell 8.3{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, Norwegian Cruise NCLH, down 11.4{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, and Royal Caribbean RCL shares slid 13{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, United Airlines UAL declined 9.6{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, Southwest Airlines LUV shares dropped 4.3{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, American Airlines’s AAL stock slumped 8.8{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}.

  • Meanwhile, shares of companies associated with the stay-at-home trade were set to rise, including Netflix NFLX rose 1.1{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} and Peloton Interactive Inc.
    PTON,
    +5.67{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}
    advanced 3.4{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, while Zoom Video Communications Inc. shares
    ZM,
    +5.72{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}
    rallied 5.7{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}.

How are other markets faring?
  • The 10-year Treasury note TMUBMUSD10Y retreated by more than 10 basis points to ell to around 1.54{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, versus 1.644{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} on Wednesday at 3 p.m. ET. The bond market was closed on Thursday in observance of U.S.

  • The ICE U.S. Dollar Index DXY, a measure of the currency against a basket of six major rivals, was down 0.7{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}.

  • Gold futures for December delivery GCZ21 rose less than 0.1{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} to trade at $1,785.30 an ounce. U.S. oil futures CLF22 traded off more than 12{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} at around $68.27 a barrel.

  • The Stoxx Europe 600 SXXP closed 3.7{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} lower, and London’s FTSE 100 index UKX also gave up 3.6{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}.

  • In Asia, the Shanghai Composite SHCOMP finished off 0.5{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} higher, while the Hang Seng Index HSI lost 2.7{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} in Hong Kong. China’s CSI 300 000300 declined 0.7{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} and Japan’s Nikkei 225 NIK finished 2.5{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} lower.