Voice of America
22 Sep 2020, 03:05 GMT+10
Wall Street slumped Monday as markets tumbled worldwide on worries about the pandemic's economic pain, though the S&P 500 had pared its losses by the end of the day.
The drops 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., stocks and Treasury yields weakened, while prices sank for oil and other commodities that a healthy economy would demand.
The S&P 500 fell 38.41 points, or 1.2%, to 3,281.06. It extends the index's losing streak to four days, its longest since stocks were selling off in February on recession worries. But a last-hour recovery helped the blue-chip index more than halve its loss of 2.7% from earlier in the day.
The Dow Jones Industrial Average fell 509.72, or 1.8%, to 27,147.70 after coming back from an earlier 942-point slide. The Nasdaq composite slipped 14.48, or 0.1%, to 10,778.80 after recovering from a 2.5% drop.
Wall Street has been shaky this month, and the S&P 500 has dropped 8.4% since hitting a record high 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 remain 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 how 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.
Divided country
Investors are also worried about the diminishing prospects that Congress may soon deliver more aid to the economy. Many investors call such support crucial after extra weekly unemployment benefits and other stimulus expired. But partisan disagreements have held up any renewal of what is known as the CARES Act.
"The stimulus money from the CARES Act, the impact of that, is running off, and there doesn't seem to be any urgency in Washington to get another package together," Joy said.
Partisan rancor is only continuing to rise, deflating hopes further. The sudden vacancy on the Supreme Court following the death of Justice Ruth Bader Ginsburg is the latest flashpoint dividing the country.
Tensions between the world's two largest economies are also weighing on markets. President Donald Trump has targeted Chinese tech companies in particular, and the Department of Commerce on Friday announced a list of prohibitions that could eventually cripple U.S. operations of Chinese-owned apps TikTok and WeChat. The government cited national security and data privacy concerns.
That raises the threat of Chinese retaliation against U.S. companies.
Coronavirus pandemic
Layered on top of all those concerns for the market is the continuing coronavirus pandemic and its effect on the global economy.
On Sunday, the British government reported 4,422 new coronavirus infections, its biggest daily rise since early May. An official estimate shows new cases and hospital admissions are doubling every week.
Prime Minister Boris Johnson later this week is expected to announce a slate of short-term restrictions that will act as a "circuit breaker" to slow the spread of the disease. The number of cases has been rising quickly in many European countries, and while authorities do not seem ready to return to the tough restrictions on public life that they imposed in the spring, the new wave of the pandemic threatens the economic outlook.
September's losses for markets are reversing months of remarkable gains. Beginning in late March, when the Federal Reserve and Congress pledged massive amounts of support for the economy, the S&P 500 erased its nearly 34% in losses caused by the pandemic. Signs of budding economic improvements accelerated the gains, but growth has slowed recently.
Get a daily dose of Cambodian Times news through our daily email, its complimentary and keeps you fully up to date with world and business news as well.
Publish news of your business, community or sports group, personnel appointments, major event and more by submitting a news release to Cambodian Times.
More InformationKHAN YOUNIS, Gaza - Seven Israeli soldiers were killed in a large explosion in southern Gaza's Khan Younis area on Tuesday night,...
DUBAI, U.A.E.: Iran's top clerics are quietly accelerating succession plans for Supreme Leader Ayatollah Ali Khamenei, who was threatened...
BEIJING, China: Extreme weather is once again testing China's resilience, as intensifying monsoon rains trigger floods across major...
LONDON/PARIS: British and French authorities have warned people to stay safe as an early summer heat wave brings unusually high temperatures...
ANKARA, Turkey: Amid rising tensions in the Middle East, the Organisation of Islamic Cooperation (OIC) announced it would form a new...
WASHINGTON DC, - U.S. President Donald Trump has claimed a ceasefire has been reached between Israel and Iran. He made the claim on...
Mumbai (Maharashtra), June 25 (ANI): After waiting in the wings for his opportunity, Bhupinder Singh eventually made his way into the...
(250625) -- PHILADELPHIA, June 25, 2025 (Xinhua) -- Players of Chelsea celebrate after winning the Group D football match between England's...
New Delhi [India] June 25 (ANI): The Indian Street Premier League (ISPL), India's pioneering tennis-ball T10 cricket league, has announced...
New Delhi [India], June 25 (ANI): India marked one of the greatest days in cricket history as they lifted the ICC ODI World Cup for...
New Delhi [India] June 25 (ANI): New Zealand have announced their schedule for the upcoming home summer, with a whopping five teams...
CHARLOTTE, 24th June, 2025 (WAM) -- Portuguese side Benfica secured the top spot in Group C of the FIFA Club World Cup with a 1-0 victory...