The New York stock market fell ahead of the Thanksgiving holiday scheduled for the 24th due to concerns about the coronavirus in China.
In the New York Stock Exchange (NYSE) on the 21st (US Eastern time), the Dow Jones Industrial Average 30 closed at 33,700.28, down 45.41 points (0.13%) from the battlefield.
The Standard & Poor’s (S&P) 500 index closed at 3,949.94, down 15.40 points (0.39%) from the battleground, and the Nasdaq closed at 11,024.51, down 121.55 points (1.09%).
Investors were cautious, paying attention to the increase in confirmed cases of COVID-19 in China, comments from Fed officials, and Thanksgiving and Black Friday scheduled for later in the week.
Investor sentiment declined as news emerged that China was tightening quarantine reins again as the number of confirmed cases of Corona 19 increased.
The number of new infections in China has exceeded 20,000 for four consecutive days since the 16th, and is close to the highest level recorded during the spread of Corona 19 this spring. 19 deaths occurred.
Shijiazhuang, the provincial capital of Hebei Province, effectively implemented a blockade of six downtown areas by the 25th, and Wuhan, the capital of Hubei Province, also decided to block five downtown areas for five days.
Beijing decided to close populated indoor facilities where a large number of infected people occurred, and other places such as Guangzhou in Guangdong Province, Hancheng City in Shaanxi Province, and Harbin City in Heilongjiang Province were put under lockdown.
Casino-related stocks such as Wynn Resorts and Las Vegas Sands fell more than 2% on concerns over China’s blockade.
Travel-related stocks such as American Airlines and Norwegian Cruise Line were also weak.
Fed officials have hinted at the possibility of slowing the pace of rate rises, but the impact on markets has been limited.
Cleveland Fed President Loretta Mester said in an interview with CNBC that day that the pace of rate hikes at the upcoming December meeting could be slower than 0.75 percentage points, which seems very appropriate.
San Francisco Fed President Mary Daley said it was “too early” to take anything off the table about the pace of rate hikes in December.
He said that the financial environment on this day appears to be around 6%, which is tighter than the actual base rate of 3.75% to 4.00% When making decisions, he argued that the difference between the base rate needs to be taken into account real and the tightening financial environment.
However, he warned against over-interpretation by telling reporters that day that he saw the proxy rate, which shows the financial environment, as around 6%, “It doesn’t mean we should stop earlier , but it was used as one of the indicators.”
As the possibility of a strike by the railway union in the United States increases again, the possibility of a logistics crisis ahead of the year-end shopping season is also adversely affecting investor sentiment.
A major railroad union in the United States, the SMART Transit Chapter, rejected the tentative agreement by member vote.
In response to this news, four other unions have so far rejected the mediation plan.
It is possible that the unions who rejected the tentative agreement will go on strike if they fail to reach an agreement with management by the 9th of the following month.
US economic indicators released on the day were sluggish.
The US National Activity Index (NAI) for October published by the Federal Reserve Bank of Chicago (Yeoneun) recorded -0.05, turning negative from 0.17 the previous month.
This means that US growth in October was below the long-term average.
Goldman Sachs said the recent rally was temporary and predicted the bottom of the stock market would come next year.
Goldman Sachs predicted that stock prices will fall further before bottoming out next year, saying that most of the fall in stock valuation this year is due to rising interest rates, and the profit loss due to the recession has not been reflected again in the price.
Goldman’s forecast for the S&P 500 index for December next year was presented at 4,000 points.
Morgan Stanley presented a forecast of 3,900 points at the end of next year and predicted that the stock market would reach its bottom in the first quarter of next year.
This week, the stock market will be closed on the 24th for the Thanksgiving holiday, and on the 25th, it will close early at 1:00 pm, so trading volume is expected to be relatively low.
Investors are paying attention to see if consumption will show a strong appearance on ‘Black Friday’, the shopping season of the coming Friday.
Earlier this week, earnings from retailers like Best Buy, Nordstrom, Dick’s Sporting Goods and Dollar Tree also come out.
Consumer discretionary, energy and technology stocks in the S&P 500 index fell more than 1%, while stocks related to consumer staples, real estate, utilities and materials rose slightly.
Among individual stocks, shares rose more than 6% on news that Walt Disney had reappointed Bob Iger, who had led Disney for the past 15 years, as the company’s CEO.
Cabana’s share price fell by more than 12% on the news that Argos had downgraded its investment rating from Hold to Sell.
Coinbase shares fell more than 8% as Bitcoin fell again following FTX’s bankruptcy filing.
Bitcoin fell more than 4% to the $15,000 level, breaking its lowest level in two years.
New York stock market experts pointed out that the increase in confirmed corona19 cases in China is adversely affecting investor sentiment.
Susannah Streeter, senior investment analyst at Hargreaves Lansdowne, told MarketWatch: “Financial markets are being hit by fears that rising cases of COVID-19 and new tightening of lockdowns in China will reduce manufacturing output and demand for raw materials.”
Art Hogan, chief market strategist at B. Reilly Financial, told CNBC that China’s reopening has put a dent in the long-awaited global economic recovery story.
The Chicago Board Options Exchange (CBOE) Volatility Index (VIX) recorded 22.36, down 0.76 points (3.29%) from the battlefield.
/happy news
