The Washington Post Sunday

Stocks drop on warnings about valuation, growth risks

- BY ELAINE CHEN AND VILDANA HAJRIC BLOOMBERG NEWS

U.S. equities dropped as concerns mounted over valuation risks and slowing growth.

The S&P 500 fell 1.7 percent in the four-day span to 4,459 after two weeks of gains. It was the biggest weekly loss since June. The Dow Jones industrial average declined 2.4 percent while the Nasdaq dropped 1.4 percent.

Investors returned from the long Labor Day weekend with growing worries about the U.S. recovery. The S&P 500 fell the Friday before the holiday on disappoint­ing payroll numbers and then declined every day thereafter, leading to the longest streak of daily losses since February. Strategist­s at several Wall Street banks turned cautious on U.S. equities, noting high valuations and potentiall­y weak economic data to come.

“Fall has arrived,” said Lauren Goodwin, economist and multi-asset portfolio strategist at New York Life Investment­s. “There’s been a lot of uncertaint­y around what would happen in the fall or after Labor Day because unemployme­nt benefits are expiring, kids are going back to school; meanwhile, the delta variant cases appear to be peaking, but we’re uncertain what that looks like.”

The Treasury will sell 13- and 26-week bills Monday. It will sell four- and eight-week bills Thursday.

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