Stock Market News for Mar 24, 2021
U.S. stock markets closed lower on Tuesday as concerns mounted over global economic reopening as fresh COVID-19 restrictions are being imposed across major European countries. Moreover, investors also became concerned about the cost of the government’s infrastructure spending and potential tax hikes. All the three major stock indexes ended the day in red.
How Did The Benchmarks Perform?
The Dow Jones Industrial Average (DJI) fell 0.9%, or 308.05 points, closing at 32,423.15, snapping its gains from Monday. Notably, 22 components of the 30-stock index ended in red while 8 finished the day in green.
The tech-heavy Nasdaq Composite closed the day at 13,227.70, down 1.1% or 149.84 points, reversing its two-day winning streak, on the back of weak performance by large-cap technology stocks. The S&P 500 lost 0.8%, closing the day at 3,910.52, giving up its gains from Monday. The Materials Select Sector SPDR (XLB) and the Industrials Select Sector SPDR (XLI) dipped 2.1% and 1.8%, respectively. Notably, eight out of eleven sectors of the benchmark index closed in the negative zone and three in green.
The fear-gauge CBOE Volatility Index (VIX) was up 7.5% to 20.30. A total of 12.10 billion shares were traded on Tuesday, lower than the last 20-session average of 14.04 billion. Decliners outnumbered advancers on the NYSE by a 3.42-to-1 ratio. On Nasdaq, a 6.64-to-1 ratio favored declining issues.
Concerns Over Fresh COVID-19 Restrictions Globally Moved Wall Street Lower
Wall Street moved lower on Tuesday as concerns mounted over global economic reopening as fresh COVID-19 restrictions are being imposed globally. Notably, major European countries like Germany extended its lockdown till Apr 18 while on Saturday, almost a third of France entered into a one-month lockdown.
Consequently, shares of airline stocks which depend on economic reopening like Mesa Air Group, Inc. MESA and Ryanair Holdings plc RYAAY fell 4.2% and 1.7%, respectively. Notably, both companies carry a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Investors Became Concerned Over Cost of Infrastructure Spending and Potential Tax Hikes
Investors’ sentiment also took a hit on Tuesday as concerns rose over the cost of infrastructure spending as well as potential tax hikes in order to pay for the $1.9 trillion stimulus bill. Notably, Treasury Secretary Janet Yellen, at a hearing of the House Financial Services Committee, defended developing plans for raising taxes in the future for funding new public investments.
Economic Data
The U.S. Census Bureau and the U.S. Department of Housing and Urban Development jointly reported that the sales of new single-family houses in February 2021 decreased 18.2% to a seasonally adjusted annual rate of 775,000, compared to the revised January rate of 948,000, missing the consensus estimate of 867,000.
The U.S. Bureau of Economic Analysis reported that the U.S. current account deficit for the fourth quarter of 2020 widened by $7.6 billion, or 4.2%, to $188.5 billion, compared to the revised third quarter estimate of $180.9 billion, and narrower than the consensus estimate of $188.8 billion.
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