Dow slides 710 points & Nasdaq snaps 8-day win streak
|Index futures slid overnight and the major indices opened lower today.
After the open, stocks were pummeled.
And it got worse. The major indices dropped to session lows after New York Governor Cuomo said that the tri-state area will be imposing a 14-day quarantine for travelers coming from coronavirus hot spots.
After the big morning drop stocks traded sideways, eventually finishing the day with their worst drop since June 11th.
Why the drop?
One thing is sure: Markets don’t like to stay in a box forever. And we have been trading in small ranges for the past 6 trading sessions.
And with the S&P up more than 20% this quarter, stocks were ripe for profit taking (the quarter ends next week).
But there are also some big coronavirus concerns, which could mean more restrictions and travel bans…put another way = the economy could suck for awhile.
Just a few of today’s headlines:
Bloomberg – “The governor of Texas says there is a massive outbreak sweeping the state after it posted its worst day yet in new cases.’
CNBC – “California reports more than 7,000 coronavirus cases, biggest daily jump so far.”
Yahoo Finance – “California, Florida report daily records for new virus cases.”
So even though everyone’s ready for the economy to reopen and for everything to get back to normal, the pandemic has different plans.
Here’s where the major markets ended the day:
Travel stocks were hammered today.
American Airlines (AAL) stock is falling out of the sky, again! Shares fell 6.9% on headlines of coronavirus outbreaks. And the tri-state area quarantine for travelers coming from areas with major outbreaks isn’t helping matters.
Carnival Cruise Lines (CCL) isn’t out of troubled water yet. The S&P downgraded their credit rating to JUNK. This is the second time in less than a month the company has had its ratings lower. With coronavirus cases on the rise, the share price is sinking. CCL closed 11.1% lower.
Dell Technologies (DELL) stood out in a sea of red after finishing the day with an 8.4% gain. What was the reason? Dell announced that it was considering unloading its 81% stake in VMware Inc. Or possibly even acquiring the remaining 19% of the company, valued at 12.5 billion.
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