Stocks fall as Europe eyes curbs to halt virus spread
U. S. stock indexes erased much of their early losses and closed modestly lower Thursday, extending the S& P 500’ s losing streak to a third day.
The S& P 500 fell 0.2% after having been down 1.4%. Technology, health care and communications stocks accounted for most of the selling, outweighing slight gains in banks and elsewhere in the market.
Wall Street has turned cautious this week amid a confluence of worrisome trends for the economy, which is still hampered by the pandemic.
Coronavirus infections are rising in Europe, prompting governments in France and Britain to impose new measures to contain the outbreak. European stock indexes fell broadly Thursday as traders pulled money out of riskier investments.
In the U. S., investor optimism that the Trump administration and Congress will soon reach a deal on another round of stimulus for the economy has waned.
And the government said Thursday that the number of Americans seeking unemployment aid increased more than expected last week.
“The stimulus talk continues to be a little negative, and the virus outbreak in Europe that’s going to probably cause more shutdowns in various cities and countries, that’s a little bit of a negative, too,” said Scott Wren, senior global market strategist, Wells Fargo Investment Institute.
Still, Wren added, the market is expecting Washington will deliver another round of stimulus at some point, and continues to expect that various efforts to develop COVID- 19 treatments and vaccines will pan out, eventually.
The S& P 500 fell 5.33 points to 3,483.34. The Dow Jones Industrial Average dropped 19.80 points, or 0.1%, to 28,494.20. It had been down 332 points in the early going. The Nasdaq composite gave up 54.86 points, or 0.5%, to 11,713.87.
Smaller company stocks fared better than the broader market. The Russell 2000 index of smallcap stocks bounced back from an early slide and rose 17.23 points, or 1.1%, to 1,638.88.
Stocks have been mostly climbing this month, but have pulled back this week as ongoing talks between Democrats and Republicans on an economic stimulus package have failed to deliver results. Investors have been hoping that Washington would provide more financial support for the economy since July, when a $ 600- a- week extra benefit for the unemployed expired.
The 10- year Treasury yield held steady at 0.73%.
Investors continued to weigh the latest batch of earnings reports from major U. S. companies.
Several reports so far have been better than expected, but the health crisis continues to cloud the outlook.
United Airlines slumped 3.8% Thursday after reporting that its revenue plummeted over the summer. Morgan Stanley rose 1.3% after the investment bank said its third- quarter profit jumped 25%, thanks to a surge in trading revenue and higher fees. Walgreens Boots Alliance gained 4.8% after the drugstore chain’s latest quarterly results topped Wall Street’s forecasts.