S&P 500 sinks as markets falter worldwide
NEW YORK » Stocks are closedlower on Wall Street Monday as markets tumble worldwide on worries about the pandemic’s economic pain.
The S&P 500 fell 1.2%, though a last-hour recovery helped it more than halve its loss from earlier in the day.
Losses began in Asia as soon as trading opened for the week, and they accelerated in Europe on worries about the possibility of tougher restrictions there to stem rising coronavirus counts.
In the U.S., both stocks and Treasury yields weakened, while prices sank for oil and many other commodities a healthy economy would demand.
Wall Street has been shaky this month, and the S&P 500 has dropped nearly 9% since hitting a record Sept. 2 amid a long list of worries for investors. Chief among them is fear that stocks got too expensive when coronavirus counts are still worsening, Congress is unable to deliver more aid for the economy, U.S.-China tensions are rising and a contentious U.S. election is approaching.
Investors should expect the stock market to stay volatile, perhaps through the November elections, as they wait for these questions to shake out, said Jason Draho, head of asset allocation for the Americas at UBS Global Wealth Management.
Monday’s selling was exacerbated by worries about the possibility of more business restrictions in Europe, particularly as the United States heads into flu season, Draho said, and “some investors may be stepping aside.”
David Joy, chief market strategist at Ameriprise Financial, noted that some of Monday’s sharpest drops were concentrated in areas of the market most closely tied to the economy’s strength, such as energy companies and raw-material producers.
“It seems to be a broader expression of worry about the economy,” he said.
Bank stocks took sharp losses after a report alleged that several continue to profit from illicit dealings with criminal networks despite U.S. crackdowns on money laundering.
Several Big Tech stocks also struggled again, much as they have since the market’s momentum turned early this month.