Wall Street closes lower as taper acceleration worries pile onto virus angst

Asia's Tech News Daily

#Federal Reserve Fed, #International Markets, #Wall Street

Wall Street‘s main indexes closed lower on Tuesday after Federal Reserve Chair Jerome Powell signaled that the U.S. central bank would consider speeding up its withdrawal of bond purchases as inflation risks increase, piling pressure onto a market already nervous about the latest COVID-19 variant.

In a testimony before the Senate Banking Committee, Powell indicated that he no longer considers high inflation as “transitory” and that the Fed would revisit the timeline for scaling back its bond buying program at its next meeting in two weeks.

“Powell’s comments threw a monkey in the wrench in market thinking in terms of potential taper timing. You’re seeing as a result of that, risk-off across the board,” said Michael James, managing director of equity trading at Wedbush Securities in Los Angeles.

“You also have to factor in the Omicron variant concerns. You can argue whether they’re more headline risk or reality risk but regardless, it’s having a significant impact on oil, and everything that’s tied to economic growth.”

Powell’s comments also prompted speculation among some investors about a potential acceleration in interest rate hikes.

“The principal contributor to the decline in stock prices today is the Powell commentary, regarding the upcoming Fed meeting, about accelerating the tapering of their bond buying program, which obviously leads to the prospect that rate hikes come sooner next year,” said Mark Luschini, chief investment strategist at Janney Montgomery Scott in Philadelphia.

“That somewhat hawkish shift in tone caught the market flatfooted,” Luschini said.

Meanwhile, the market was also left waiting for information about how dangerous the Omicron variant might be, the degree to which current vaccinations could offer protection and the additional restrictions governments might have to impose that could hurt the economy, Luschini said.

The Dow Jones Industrial Average fell 652.22 points, or 1.86%, to 34,483.72, the S&P 500 lost 88.27 points, or 1.90%, to 4,567 and the Nasdaq Composite dropped 245.14 points, or 1.55%, to 15,537.69.

For the month, the S&P registered a decline of 0.8%, while the Dow dropped 3.7% and the Nasdaq eked out a 0.25% gain.

Only seven of the benchmark S&P 500 components gained ground on Tuesday.

For the day, all the 11 major S&P industry sectors fell with seven of those sectors falling more than 2%. Communication services lead the losses with a 3% drop followed by Utilities’ 2.9% drop. As oil prices tumbled, energy were under pressure throughout the session, closing down 2.5%.

The top performer was information technology falling just 0.96%, with help from Apple Inc

, which boasted a recording closing high and a 3.2% gain for the day.

Tuesday’s decline was a sharp reversal after Monday’s rally in which stocks regained some ground they had lost on Friday when the market sold-off swiftly on news of the virus variant.

“The market is clearly in some treacherous waters right now. You’ve had two significant pullbacks out of the last three trading days. This is certainly shaking some of the complacent longs in the market,” said Wedbush’s James.

While the Food and Drug Administration said it hopes to have information about the effectiveness of current COVID-19 vaccines against Omicron, vaccine companies were divided.

BioNTech’s chief executive said the vaccine his company supplies in partnership with Pfizer will likely offer strong protection from severe illness in variant cases. But Moderna Inc’s CEO told the Financial Times that COVID-19 shots are unlikely to be as effective against the new variant as they have been previously.

Moderna shares fell 4.4% while Regeneron Pharmaceuticals Inc lost 2.7% after it said its COVID-19 antibody treatment and other similar drugs could be less effective against Omicron.

Travel and leisure stocks slumped, with the S&P 1500 Hotels, Restaurant and Leisure indexes fell more than 2% while the S&P 1500 Airlines index lost 0.6%.

The small-cap Russell 2000 index fell 1.9%.

The virus uncertainty has triggered fresh alarm at a time when supply chain logjams are weighing on economic recovery and central banks globally are contemplating a return to pre-pandemic monetary policy to tackle a surge in inflation.

Meanwhile, data showed U.S. consumer confidence slipped in November amid concerns about the rising cost of living and relentless COVID-19 pandemic.

Declining issues outnumbered advancing ones on the NYSE by a 3.82-to-1 ratio; on Nasdaq, a 2.40-to-1 ratio favored decliners.

The S&P 500 posted seven new 52-week highs and 45 new lows; the Nasdaq Composite recorded 28 new highs and 572 new lows.

Tuesday registered the highest volume trading session for U.S. exchanges since June with 16.13 billion shares changing hands, compared with the 11.12 billion moving average for the last 20 sessions.

Internet Explorer Channel Network
Asia's Tech News Daily
News Related

OTHER NEWS

Is Ola Electric halting production of the S1 scooter?

For those who simply want to purchase the lighter and cheaper S1 without the option of upgrading its features, you’re going to have to wait a lot longer till the ... Read more »

China must put even more electric cars on the roads at a faster rate to meet nation's 2060 carbon neutral target, Greenpeace says

Manufacturers and policymakers in China must work together to put even more zero-emission vehicles on the roads of the world’s largest vehicle market to meet the nation’s carbon neutrality target ... Read more »

Margins will come under control in the next 2-3 quarters: HCL Tech CEO C Vijayakumar

Read more »

20% fall in January bookings due to COVID-19 forces railways to cancel several train services

[Representative image: AP] Indian Railways has begun to cancel several train operations due to low occupancy, with a 20 percent fall in passenger bookings in January and rising cases of ... Read more »

G.O.A.T Brand Labs acquires The Label Life, a westernwear brand

G.O.A.T Brand Labs has taken a majority stake in The Label Life, a women’s fashion and lifestyle brand.  Founded by Preeta Sukhtankar, along with Yashika Punjabee and Sonam Shah, six ... Read more »

RBI imposes monetary penalty on The Co-operative Bank of Rajkot

The Reserve Bank of India (RBI) on January 17 imposed a monetary penalty of Rs 4 lakh on The Co-operative Bank of Rajkot, Gujarat for violation of certain norms. This action ... Read more »

Maruti Suzuki share price falls after global brokerage retains 'sell', expects 25% downside

Maruti Suzuki India share price fell over 2 percent in the morning session on January 18 after CLSA retained sell call on the stock. The scrip was trading at Rs ... Read more »

Race to cut carbon emissions splits U.S. states on nuclear

The Associated PressChris Levesque, president and CEO of TerraPower, a company developing and building small nuclear reactors, poses for a photo in the company’s lobby, Thursday, Jan. 13, 2022, in ... Read more »

Norway's Telenor to sell stake in Myanmar's Wave Money

The Associated PressFILE – In this Oct. 26, 2014, file photo, customers including Buddhist monk line up outside a showroom to buy SIM card at Telenor, Norwegian telecommunication company, in ... Read more »

Job instability, medical costs key concerns in COVID times: SBI Life study

(Image: ANI) Even as the third COVID-19 wave takes root in India, many are still reeling under the impact of the first two waves in 2020 and 2021, though there ... Read more »

Sudarshan Chemicals Q3 PAT seen up 6.5% YoY to Rs 36 cr: Sharekhan

Sudarshan Chemical Industries | Company reported profit at Rs 30.33 crore in Q2FY21 against Rs 46.2 crore, revenue rose to Rs 428.9 crore from Rs 424.85 crore YoY. (Image: Moneycontrol) ... Read more »

Banks urge Centre to extend emergency credit guarantee for small businesses till March next year

With rising commodity prices, FISME wants the abolition of import duties on steel, copper, aluminum and polymers. (Representational Image; Source: ShutterStock) The Indian Banks’ Association (IBA) has urged the government ... Read more »

NOCIL Q3 PAT seen up 17.6% YoY to Rs 26 cr: Sharekhan

Sharekhan has come out with its third quarter (October-December’ 21) earnings estimates for the Speciality Chemicals sector. The brokerage house expects NOCIL to report net profit at Rs 26 crore ... Read more »

COVID self-isolation rules, offshore wind farms and house prices

Listen to “Covid self-isolation rules, offshore wind farms and house prices”. Ian King explores the change to coronavirus self-isolation rules in England and the impact on businesses. He also speaks ... Read more »

Unit 2 of Belarusian NPP to be launched in February — Rosatom

Director General of Russia’s state-run nuclear corporation Alexey Likhachev said that right now, the colleagues are waiting for a permission to switch to minimum controlled reactor power Read more »

Indian rupee falls 18 paise to 74.43 against US dollar in early trade

Representative image The rupee declined by 18 paise to 74.43 against the US dollar in opening trade on Tuesday, as strong American currency and elevated crude oil prices weighed on ... Read more »

When should you approach a financial advisor?

Not everyone needs an investment advisor. But some people do. They may not realize it though. But a timely, unbiased and objective professional intervention can really make the difference between ... Read more »

Prestige Estates Projects hits 52-week high on record quarterly sales, collections

Shares of Prestige Estates Projects touched a 52-week high of Rs 553.40 rising eight percent intraday after the firm reported record quarterly sales for October-December. The group registered sales of Rs 4267.6 ... Read more »

Baht gains on quarantine-free travel hopes

Thailand's baht rose on Tuesday on hopes that the tourism-reliant country waives quarantine for vaccinated visitors again, while its emerging market peers gained on a US dollar unperturbed by a ... Read more »

Budget 2022: Will capital gains tax be rationalized across asset classes?

If you buy a listed bond, then you pay long-term capital gains (LTCG) tax of 10 percent, if you hold it for more than 12 months. But if you sell ... Read more »

Assembly elections in 5 states: Political parties hit virtual campaign trail

Source: Reuters Snappy hashtags, peppy tunes and quick repartee, political parties have taken their campaign to the virtual world with great aplomb as five states go to elections next month ... Read more »

Coronavirus Update | India reports 2,38,018 new COVID-19 cases, 310 deaths

With 2,38,018 new coronavirus infections being reported in a day, India’s total tally of COVID-19 cases rose to 3,76,18,271, which includes 8,891 cases of the Omicron variant, according to the ... Read more »

Daily Voice | FM likely to focus on these 5 sectors in Budget 2022: Sahil Kapoor of DSP Investment

Sahil Kapoor is the Head Products and Market Strategist at DSP Investment Managers Sahil Kapoor, Head – Products and Market Strategist at DSP Investment Managers, says it will be important ... Read more »

Nibud: household purchasing power falls on average 40 euros per month

Dutch households are losing purchasing power sharply this year due to rising prices. On average, families lose about 40 euros per month. This is stated by the National Institute for ... Read more »

SPAC backed by Chinese brokerage CMB International becomes first to file for Hong Kong listing, under new regime for blank-cheque companies

A special purpose acquisition company (SPAC) sponsored by the asset management arm of Chinese brokerage CMB International has applied to float its shares in Hong Kong, becoming the first to ... Read more »

Sebi tightens rules governing utilisation of IPO proceeds; tweaks OFS norms

Securities and Exchange Board of India (File image: Reuters) Tightening rules for initial public offering (IPO), Sebi has put a cap on the usage of the issue proceeds for unidentified ... Read more »

Budget session not likely to see crypto bill being presented

The much-awaited cryptocurrency bill, which had been scheduled for presentation during parliament’s winter session last year, is unlikely to see the light of the day during the budget session as well ... Read more »

Gold Prices Today: Yellow metal to feel pressure from higher US bond yield prices, support around Rs 47,650

Gold prices were flat on January 18 in the international markets as a weaker dollar partially offset pressure from elevated US Treasury yields, which dim the appeal of a non-yielding ... Read more »

MOEX index up 0.32% to 3,571.89 points at trade start

The price of WTI crude oil futures went up by 1.27% Read more »

What should investors do with UltraTech Cement post Q3 results; buy, sell or hold?

UltraTech Cement share price fell 2 percent amid profit booking in the early trade on January 18, a day after company reported its December quarter earnings. At 9:43 am, the ... Read more »

Will 100,000 new houses a year solve the housing crisis?

A great shortage of houses and sky-high prices for the houses that do exist. The housing market has been under great pressure for years. The new cabinet promises to solve ... Read more »

Energy crisis: Three options left to insulate households from '50% increase in bills'

The Treasury would need to approve each of the ideas still under consideration to help shield families from the worst of the looming hike in the price cap, Sky's Paul Kelso writes. Read more »

Dollar grows to 76.13 rubles on Moscow Exchange

The euro slides to 86.55 rubles Read more »

Tech Mahindra share price gains on acquisition announcement; brokerages maintain 'buy'

Tech Mahindra share price rose 1 percent in the early trade on January 18 a day after the company board approved acquisition of Com Tech Co IT. Tech Mahindra through its ... Read more »

Tatva Chinta Pharma falls over 9% at open on decline in margins

stocks_decline Shares of Tatva Chintan Pharma Chem Ltd on Tuesday declined over 9% in the opening after the firm reported a sequential fall in revenue and operating margins for the ... Read more »

How ESG standards and sustainability awareness can affect property values

How do we value our properties? Professional real estate valuers have traditionally been taught to rely on financial ratios such as profitability and capital budgeting to determine the value of ... Read more »

Asia shares mostly rise moderately after US national holiday

The Associated PressA woman wearing a face mask walks past a bank’s electronic board showing the Hong Kong share index in Hong Kong, Tuesday, Jan. 18, 2022. Asian shares were ... Read more »

Construction of El Dabaa NPP in Egypt to begin in July - Rosatom

The El Dabaa nuclear power plant will be the first nuclear power plant in Egypt Read more »

Sell GBPINR ; target of : 101.40 : ICICI Direct

Representative image ICICI Direct’s currency report on GBPINR The pound depreciated by 0.18% yesterday mainly on the back of firm dollar and risk aversion in domestic market. Further, investors fear ... Read more »

Brent climbs above 7-year high on Mideast tensions, tight supply

Representative image Oil prices rose more than $1 on Tuesday to a more than seven-year high on worries about possible supply disruptions after Yemen’s Houthi group attacked the United Arab ... Read more »
On free-english-test.com you will find lots of free English exam practice materials to help you improve your English skills: grammar, listening, reading, writing, ielts, toeic