Stocks slide on Wall Street as COVID-19 cases surge

Daniel Fowler
June 26, 2020

"The COVID-19 pandemic has had a more negative impact on activity in the first half of 2020 than anticipated, and the recovery is projected to be more gradual than previously forecast", the economists wrote in their report.

"You could argue that the market could be a fair amount lower".

The S&P 500 posted five new 52-week highs and no new lows; the Nasdaq Composite recorded 63 new highs and eight new lows.

Overnight, the head of the World Health Organization, Tedros Adhanom Ghebreyesus, warned that the coronavirus pandemic "is still accelerating" around the globe.

However, Navarro said his comments were taken out of context, and President Donald Trump tweeted that the agreement with China, the basis for a truce in a tariff war over technology and other problems, is still on. "Hopefully they will continue to live up to the terms of the Agreement!"

Among the biggest movers ahead of the opening bell in NY, shares in builder KB Home dropped 16% and Darden Restaurants gained nearly 2% following the companies' latest results.

Wednesday's sell-off may also reflect traders taking the opportunity to unload some stocks that have been big winners in the market's recent rally, said Tracie McMillion, head of global asset allocation strategy for Wells Fargo Investment Institute. Bond yields were mixed. This is the same stock that everybody buys day in and day out, so that is why this index tends to rally rather significantly.

Eastern, Dow Jones Industrial Average futures were down about 80 points, or 0.3%, following earlier modest gains, while S&P 500 futures and Nasdaq-100 futures tracked similarly.

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Small company stocks, which have lagged the broader market's rebound that began in April, also notched solid gains, with the Russell 2000 index adding 1.1%, to 1,433.53.

Advanced economies have been particularly hard hit, with USA output now expected to shrink 8.0%, more than two percentage points worse than the April forecast.

"The market seemed pretty confident we were going to be in much better shape in 4-6 months from now". Sales of previously occupied homes plunged 9.7% in May, according to the National Association of Realtors. Still, the median home price rose 2.3% from a year ago, a sign that demand could pickup up in coming months.

All the three major indexes had opened Thursday's session lower after data showed the number of people in the United States filing claims for unemployment benefits fell less than expected last week, likely as hiring by reopening businesses is being partly offset by a second wave of lay-offs. On Tuesday, the Commerce Department serves up new home sales figures for May.

In energy trading, benchmark US crude oil rose 1.9% to $38.73 a barrel. It rose 71 cents on Monday. Brent crude, the worldwide standard, fell 5.4% to close at $40.31 a barrel.

The dollar declined to 107.14 yen from Thursday's 107.23 yen.

AP Business Writers Alex Veiga and Damian J. Troise contributed.

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