NEW YORK, July 16 — US stocks fell today with the S&P 500 retreating from a five-week high as concerns about the economic toll from another round of shutdowns across the United States offset data showing upbeat domestic retail sales in June.
The Commerce Department’s report showed retail sales jumped 7.5 per cent last month compared with economists’ forecast of five per cent, signalling the economy was continuing to limp out of a coronavirus-driven slump.
But a recent surge in domestic Covid-19 cases has forced states such as California to shut down again, sparking fears of more business damage and slowing the pace of a Wall Street rally.
“Much of the easy lifting in both the equity markets and in the economy is mostly behind us,” said Michael Hans, chief investment officer at Clarfeld Citizens Private Wealth in Greater New York Area.
“Especially as it relates to retail sales, the policy moving forward is important. What goes on at the end of the month with the pandemic unemployment assistance set to expire? How does that impact the recovery and how does the consumer fare?”
Millions are set to lose their unemployment checks on July 31 when the government stops paying an additional $600 per week to jobless self-employed people, gig workers and contractors who do not qualify for regular state unemployment benefits.
Another report from the Labor Department today showed weekly jobless claims fell to 1.30 million in the week ended July 11, down slightly from the previous week but remain roughly double their highest point during the global financial crisis.
At 9.49am ET, the Dow Jones Industrial Average was down 125.92 points, or 0.47 per cent, at 26,744.18, the S&P 500 was down 21.88 points, or 0.68 per cent, at 3,204.68. The Nasdaq Composite was down 116.37 points, or 1.10 per cent, at 10,434.12.
Technology stocks weighed the most on all the three indexes. Among major S&P sectors, communication services, technology and energy lagged the most.
Bank of America Corp fell 3.8 per cent after its second-quarter profit more than halved, while Morgan Stanley rose 1.6 per cent after posting a record quarterly profit.
Twitter Inc fell 2.8 per cent as hackers accessed its internal systems to hijack some of the platform’s top voices including US presidential candidate Joe Biden, reality TV star Kim Kardashian West, former US President Barack Obama and billionaire Elon Musk and used them to solicit digital currency.
American Airlines dropped 6.5 per cent as it sent 25,000 notices of potential furloughs to frontline workers and warned that demand for air travel is slowing again.
Tesla Inc slipped 2.8 per cent as its vehicle registrations nearly halved in the US state of California during the second quarter, according to data from a marketing research firm.
Declining issues outnumbered advancers for a 3.09-to-1 ratio on the NYSE and for a 3.39-to-1 ratio on the Nasdaq.
The S&P index recorded 20 new 52-week highs and no new lows, while the Nasdaq recorded 51 new highs and nine new lows. — Reuters
