Markets dip as virus fears drown out economic hope
Wall Street careened through all the forces that have pushed and pulled it through the week, at first rising on Friday amid hope for the economy and then falling on worries about worsening coronavirus levels in some states, all before ending with modest losses.
The S&P 500 dropped 0.6%, a relatively small move to cap its fourth weekly gain in the last five. But the market swung between a gain of 1.3% and a decline of 1%, another example of how uncertainty is the dominant force over Wall Street as investors weigh budding improvements in the economy against worsening infection levels in the South and West. The Dow Jones Industrial Average dropped 208.64 points, or 0.8%, to 25,871.46 after earlier swinging from a gain of 371 points to a loss of 320 points. The Nasdaq composite inched up by 3.07 points, or less than 0.1%, to 9,946.12. The S&P 500 fell 17.60 points to 3,097.74.
Also exacerbating volatility was Friday’s simultaneous expiration of contracts for stock options and futures, an occasional occurrence that can drive bouts of buying and selling and is known as “quadruple witching day.”
Early in the day, U.S. stocks appeared set to follow European and Asian markets higher and follow through on Wall Street’s momentum from earlier in the week.
Stocks had rebounded from last week’s 4.8% drop, the worst in nearly three months, in large part because of a report showing U.S. shoppers spent much more last month at stores and online retailers than economists expected. That followed up on encouraging data about the U.S. jobs market and bolstered hopes that the economy can pull out of its recession relatively quickly. “You’re seeing big moves off of very weak numbers,” said Quincy Krosby, chief market strategist at Prudential Financial. “What’s happening is the data are getting less bad.”
But markets took a sharp turn lower Friday afternoon after Apple said it will temporarily close 11 stores in Arizona, Florida and the Carolinas because of outbreaks.
In another demonstration of how long the road will be back to a normal economy, the Cruise Lines International Association said Friday that its members are volunteering not to sail any voyages from U.S. ports until Sept. 15.