Wall Street’s main stock indexes were firmly in the red on Wednesday as rising coronavirus infections in the United States fuel fears of more growth-sapping pandemic restrictions and curb investor appetite for risk.
In late morning trading on Wall Street, the Dow Jones Industrial Average was down more than 802 points or 2.92 percent at 26,661.10.
The S&P 500 – a gauge for the health of US retirement and college savings reports – and the tech-heavy Nasdaq Composite Index were both down more than 3 percent.
A bludgeoning pandemic and failure in Washington to pass fiscal support sent the S&P 500 and Nasdaq spiralling to their lowest close in three weeks on Tuesday. The Cboe Volatility Index, known as Wall Street’s “fear gauge”, spiked on Wednesday to its highest level in nearly two months as uncertainty grows around the course of the pandemic and the outcome of the US election on November 3.
New infections and hospitalisations are setting records in the US Midwest as Washington continues to squabble over the scope of the next round of virus relief aid. The impasse could leave millions of out-of-work Americans and struggling businesses entering the cold and heavy flu season and another round of possible restrictions without additional federal support.
It is unlikely that a deal will be struck before Election Day, which also brings its own set of concerns.
It remains entirely possible that the US will not have a clear winner when polls close on Tuesday and or that the results could be challenged.
Concerns are mounting over the possible delay in counting a large number of mail-in ballots.
Covid, Covid, Covid is the unified chant of the Fake News Lamestream Media. They will talk about nothing else until November 4th., when the Election will be (hopefully!) over. Then the talk will be how low the death rate is, plenty of hospital rooms, & many tests of young people.
— Donald J. Trump (@realDonaldTrump) October 28, 2020
President Donald Trump’s Democratic rival Joe Biden is leading in national polls, but the race has tightened in key battleground states, which are likely to determine the winner.
Trump took to Twitter on Wednesday morning to throw shade on the media, accusing it of engaging in a “unified chant” and up-playing the threat of the virus to sway election results.
“They will talk about nothing else until November 4th, when the Election will be (hopefully!) over. Then the talk will be how low the death rate is, plenty of hospital rooms, & many tests of young people,” Trump wrote.
Things are not looking any better across the pond. The coronavirus pandemic is raging in Europe again, with severe restrictions, curfews and lockdowns returning to Spain, Italy and the United Kingdom.
Anti-lockdown demonstrations have turned violent as people have taken to the streets to protest the restrictions that have millions on the continent out of work and on the brink of poverty.
Worldwide, the travel and services industries have been hit the hardest as the COVID-19 pandemic guts air travel and shutters hotels, restaurants and bars. As the possibility of another round of lockdowns lingers, industries are coming to grip with the fact that things may not return to the pre-pandemic way of life for years to come.
Mass layoffs in the travel industry continue with more furloughs and pink slips on the horizon.
In a memo to employees on Wednesday, Boeing Chief Executive Dave Calhoun said the company expects to eliminate some 30,000 jobs through buyouts, layoffs and attrition by the end of 2021.
The news hit the same day as the aerospace giant reported its fourth straight quarterly loss as the COVID-19 pandemic and the ongoing 737 MAX grounding hammers Boeing’s bottom line.
Boeing’s revenue fell 29 percent to $14.14bn in the third quarter – topping analysts’ estimate of $13.90bn. The company also reaffirmed its expectation that US deliveries of the 737 MAX – grounded worldwide after two fatal accidents- would resume before year-end.
Shares of Boeing were down 3.64 percent in late morning trading in New York.
Tech stocks were also in the spotlight as the chiefs of Facebook, Twitter and Google parent Alphabet testify before the Senate Commerce Committee on Wednesday over protections they have shielding them from liability over content that users post on their social media platforms.
Microsoft is also moving after reporting quarterly results after the bell on Tuesday that surpassed analysts’ expectations. Shares of the tech giant were down more than 4 percent.
All eyes are now turning to Apple, Alphabet, Amazon and Facebook, which are due to report earnings results on Thursday.