Stocks have moved significantly lower over the course of morning trading on Monday, giving back ground following the strong upward move seen last week. The major averages have all slid firmly into negative territory.
In recent trading, the major averages have seen further downside, hitting new lows for the session. The Dow is down 523.48 points or 2.2 percent at 23,195.89, the Nasdaq is down 86.49 points or 1.1 percent at 8,067.09 and the S&P 500 is down 56.54 points or 2 percent at 2,733.28.
The pullback on Wall Street is partly due to profit taking, as some traders cash in on last week’s gains, which lifted the major averages to their best levels in nearly a month.
Lingering concerns about the economic impact of the coronavirus pandemic are also weighing on the markets, with the number of daily deaths from the disease in the U.S. reaching a record high of more than 2,000 on Friday.
However, White House health advisor Dr. Anthony Fauci expressed “cautious optimism” the outbreak is slowing down in an interview with CNN on Sunday.
Fauci noted that hospitalizations and intensive care admissions in the New York metropolitan area have not only flattened but stated to turn the corner.
“So, that’s where we’re hopeful. And it’s cautious optimism that we’re seeing that decrease,” Fauci said. “And if you look at the patterns of the curves in other countries, once you turn that corner, hopefully, we will see a very sharp decline.”
At the same time, Fauci cautioned that reopening the country will not be like flipping a light switch and will depend on the situation in different parts of the country.
Overall trading activity may be somewhat subdued, as many overseas markets are closed for Easter Monday holidays.
A lack of major U.S. economic data may also keep some traders on the sidelines, although reports on retail sales, industrial production and housing starts may attract attention in the coming days.
Housing stocks have pulled back sharply following recent strength, with the Philadelphia Housing Sector Index plunging by 5.3 percent after skyrocketing by nearly 30 percent last week.
Profit taking is also contributing to substantial weakness among banking stocks, as reflected by the 4.1 percent nosedive by the KBW Bank Index.
Commercial real estate, chemical, brokerage and utilities stocks are also seeing considerable weakness after turning in some of the market’s best performances last week.
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower on Monday, although several major markets were closed for holidays. Japan’s Nikkei 225 Index tumbled by 2.3 percent, while China’s Shanghai Composite Index fell by 0.5 percent.
Meanwhile, the European markets remain closed today for Easter Monday.
In the bond market, treasuries have climbed off their worst levels of the day but continue to see modest weakness. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 1.2 basis points at 0.741 percent.
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