The S&P 500 edged higher, while the Cboe volatility index was on track for its biggest weekly rise since January. An earlier decline in stocks was due to anxiety over the Federal Reserve’s stimulus withdrawal, the spread of the virus and global supply chains. Metal prices collapsed as part of a massive sell-off that spilled over to agriculture, oil and natural gas.
Stocks struggled to maintain momentum after hitting yet another all-time high earlier in the week. Investors are bracing for the unprecedented cash drawdown as the developed world turns to mass vaccinations to keep the recovery on track. However, the persistent spread of the coronavirus and the slowdown in Chinese growth raise the question of whether the global economy can absorb the end of the stimulus measures. This prompts traders to buy protection against stock fluctuations.
“This week’s options expiration is probably amplifying volatility,” wrote Tom Essaye, a former Merrill Lynch trader who founded the newsletter “The Sevens Report”. “This market remains complacent and vulnerable to ‘air pockets’. “
COVID-19 patients are dying in U.S. hospitals at levels not seen since February – and the numbers could worsen as intensive care units overflow in parts of the South. Three U.S. senators have tested positive despite being vaccinated, bringing the number of members of Congress to report recent infections to at least six.
Nvidia Corp., America’s largest chipmaker by market value, rebounded after reporting an increase in profits and giving forecasts that exceeded even bullish Wall Street estimates. Robinhood Markets Inc. sank after warning that the cryptocurrency-driven trading that fueled quarterly income could quickly fade away. Chinese stocks listed in the United States suffered another day of selling after authorities triggered a new round of proposed regulations. Tencent Holdings Ltd. and Alibaba Group Holding Ltd. each fell by more than 6%.
Some of the main movements in the markets:
- The S&P 500 rose 0.1% at 4 p.m. New York time
- The Nasdaq 100 rose 0.5%
- The Dow Jones Industrial Average fell 0.2%
- MSCI World index fell 0.7%
- Bloomberg Dollar Spot Index rose 0.5%
- The euro fell 0.3% to US $ 1.1676
- The British pound fell 0.9% to US $ 1.3635
- The Japanese yen was little changed at 109.79 per dollar
- The yield on 10-year treasury bills fell two basis points to 1.24%
- The German 10-year yield was little changed at -0.49%
- UK 10-year yield fell three basis points to 0.54%
- West Texas Intermediate crude fell 2.2% to US $ 64.02 per barrel
- Gold futures have changed little