NEW YORK (Reuters) – Wall Street shares closed sharply lower on Monday, slipping from all-time highs on the first trading day of the year as risk appetite eased amid Georgia’s upcoming election, and persistent increase in coronavirus cases.
Dow, which hit a record low earlier in the session with the S&P 500, was also pulled down by a 4% drop in Boeing Co shares after Bernstein downgraded its rating to “underperforming”. ”, Raising concerns about cash flow.
All three major indices hit two-week lows, with record highs in the Dow and the S&P 500, extending a 2020 rally fueled by the monetary stimulus and the start of vaccine launches.
The fate of President-elect Joe Biden’s agenda, meanwhile, including rewriting the tax code, boosting incentives and spending on infrastructure, depends heavily on the Senate’s twin races on Tuesday in Georgia’s state of war, which will control the chamber.
The Wall Street fear indicator hit a two-week high on Monday.
“The stock is retreating from an amazing year of gains,” Brian Reynolds, chief market strategist, told Reynolds Strategy.
“We start with a virus out of control. We will probably end 2021 with a virus that could be controlled by then. The way we get from the beginning to the end will be filled with frequent withdrawals, because people will look at short-term titles, “he added.
The total number of deaths in the United States due to COVID-19 has reached over 350,000.
Almost all S&P sectors fell, with real estate, utilities and industries recording the lowest percentages. Discretion and consumer materials reached all-time highs at the beginning of trading.
The Dow Jones industrial average fell 382.59 points, or 1.25%, to 30,223.89, the S&P 500 lost 55.42 points, or 1.48%, to 3,700.65, and the Nasdaq Composite fell 189.84 points, or 1.47%, to 12,698.45.
The S&P 500 and Dow recorded the largest daily percentage declines since the end of October, while the Nasdaq recorded the biggest loss since December 9th.
“Investors are at a time when they want to take a breather as they evaluate all the different things that are coming in the new year,” said Lindsey Bell, chief investment strategist at Ally Invest in Charlotte, North Carolina.
In terms of data, US production activity grew at the fastest pace in six years in December, a survey showed on Monday. It follows optimistic factory activity surveys in Europe and Asia earlier in the day.
Some investors are cautious about the pace of economic growth, as US unemployment claims remain stubborn, while a new round of pandemic restrictions last month and a new variant of the coronavirus have cast a shadow over the outlook.
Shares of Tesla Inc. extended a meteoric rally to a record high after the electric car maker reported better-than-expected vehicle deliveries in 2020.
Shares of FLIR Systems Inc. rose more than 19 percent after Teledyne Technologies Inc. agreed to buy the thermal chamber supplier for $ 8 billion in cash and stock. Teledyne shares, however, fell by 7.5%.
Declining issues outnumbered those on the NYSE ahead by 2.14 to 1; on the Nasdaq, a 1.43 to 1 ratio favored declines.
The S&P 500 recorded 54 new 52-week highs and no new lows; Nasdaq Composite recorded 151 new highs and 19 new lows.
The volume of US stock exchanges reached 14.15 billion shares, compared to the average of 10.94 billion for the full session in the last 20 trading days.
Reporting by Gertrude Chavez-Dreyfuss; Montages of Marguerita Choy