JUNE 17 — The S&P 500 and the Dow were largely flat today as a record rise in coronavirus cases in six US states dented sentiment following a three-day rally on hopes of a swift recovery from a coronavirus-driven downturn.
Arizona, Florida and Oklahoma were among the states that saw a record increase in new infections yesterday as businesses reopened. Beijing extended its movement curbs as it fought the worst resurgence of the disease since early February.
Cruise operator Norwegian Cruise Line Holdings Ltd tumbled about 6.7 per cent as it extended the suspension of its voyages through September end due to the virus outbreak.
Peers Carnival Corp and Royal Caribbean Cruises Ltd also dropped 6.1 per cent and 7.8 per cent each.
The benchmark S&P 500 wrapped up its best three-day percentage rise in a month yesterday after a report on a massive fiscal stimulus plan and a stunning retail sales report for May reflected a pickup in demand as businesses reopened.
“The market got ahead of itself based on the Fed stimulus,” Matt Peden, chief investment officer at GuideStone Capital Management in Dallas said. “There could be further consolidation in the marketplace, that would be healthy, and would bring stocks closer to a more rational valuation level.”
Encouraging economic data and trillions of dollars in monetary and fiscal stimulus have propelled a rally in the Wall Street indexes from their late-March trough.
The S&P 500 is about 3 per cent below its record closing high hit in February, while the tech-heavy Nasdaq was about 1 per cent below its all-time closing high on June 10.
Federal Reserve Chair Jerome Powell warned yesterday that a full recovery is unlikely until the public is confident that the disease is under control, as he testified before US lawmakers. The second day of his virtual hearing will begin at 12 p.m. ET (1400 GMT).
At 11:09 a.m. ET, the Dow Jones Industrial Average was down 25.50 points, or 0.10 per cent, at 26,264.48, the S&P 500 was up 0.91 points, or 0.03 per cent, at 3,125.65. The Nasdaq Composite was up 49.02 points, or 0.50 per cent, at 9,944.88 with Apple Inc, Microsoft Corp and Amazon.com providing the biggest boost.
Energy and utilities led losses among the major S&P sectors.
Oracle Corp fell 4.2 per cent after its quarterly revenue missed estimates as the pandemic led clients in the hospitality, retail and transportation sectors to postpone purchases.
Declining issues outnumbered advancers for a 1.47-to-1 ratio on the NYSE and a 1.33-to-1 ratio on the Nasdaq.
The S&P index recorded nine new 52-week highs and no new low, while the Nasdaq recorded 86 new highs and four new lows. — Reuters