Following the pullback seen in the previous session, stocks saw further downside during the trading day on Tuesday. The major averages all showed notable moves to the downside on the day.
The major averages climbed off their worst levels of the day but still closed firmly in negative territory. The Dow slid 256.33 points or 0.8 percent to 33,821.30, the Nasdaq slumped 128.50 points or 0.9 percent to 13,786.27 and the S&P 500 fell 28.32 points or 0.7 percent to 4,134.94.
The weakness that emerged on Wall Street came as traders continued to cash in on the recent strength in the markets.
Profit taking also contributed to the pullback on Monday after the Dow and the S&P 500 ended last Friday’s trading at new record closing highs.
A new wave of coronavirus infections overseas also weighed on the markets amid concerns about new restrictions and the impact on the global economy.
Meanwhile, traders largely shrugged off upbeat earnings news from companies like Procter & Gamble (PG), Johnson & Johnson (JNJ) and Travelers (TRV).
Energy stocks showed a substantial move to the downside on the day, moving lower along with the price of crude oil. Crude for May delivery slumped $0.94 to $62.44 a barrel amid concerns about the outlook for demand.
Reflecting the weakness in the energy sector, the Philadelphia Oil Service Index plunged by 4.6 percent and the NYSE Arca Oil Index tumbled by 3.1 percent.
Significant weakness was also visible among airline stocks, resulting in 4.4 percent nosedive by the NYSE Arca Airline Index. The index ended the session at a two-month closing low.
United Airlines (UAL) helped lead the sector lower, plummeting by 8.5 percent after reporting a wider than expected first quarter loss.
Housing, financial, and tobacco stocks also saw considerable weakness, while interest rate-sensitive utilities and commercial real estate stocks bucked the downtrend.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Tuesday. Japan’s Nikkei 225 Index plunged by 2 percent, while China’s Shanghai Composite Index edged down by 0.2 percent.
The major European markets showed notable moves to the downside on the day. While the German DAX Index slumped by 1.6 percent, the U.K.’s FTSE 100 Index and the French CAC 40 Index tumbled by 2 percent and 2.1 percent, respectively.
In the bond market, treasuries regained ground following the pullback seen over the two previous sessions. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, slid 3.9 basis points to 1.562 percent.
Looking Ahead
Amid another quiet day on the U.S. economic front, trading on Wednesday may be impacted by reaction to the latest earnings news.
Netflix (NFLX), CSX Corp. (CSX) and Tenet Healthcare (THC) are among the companies releasing their quarterly results after the close of today’s trading.
Anthem (ANTM), Halliburton (HAL), and Verizon (VZ) are also among the companies due to report their results before the start of trading on Wednesday.
Business News
Profit Taking Contributes To Extended Pullback On Wall Street
2021-04-20 20:16:32
