Wall Street Close: Pandemic woes keep benchmarks red for second day

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  • DJI30 registers heaviest drop in a month, S&P 500 and Nasdaq decline 0.68% and 0.92% respectively.
  • COVID infections jump as India leads the tally, Japan may recall virus-led emergencies in the key states and surrounding prefectures.
  • US 10-year Treasury yields part ways from US dollar performance.
  • Netflix reports heavy slowdown in subscriber growth.

US equity markets stay jittery on Tuesday as the coronavirus (COVID-19) fears pushed the risks off the cliff amid a light calendar and declining US Treasury yields. Further, the after-market release of Netflix earnings adds to the pessimism.

The Dow Jones Industrial Average (DJI30) marked the heaviest drop since March 23 with its 256-point decline, or 0.75%, whereas Nasdaq 100 was the biggest losing index of the day while reporting 0.92% daily downside to 13,786. Moving on, S&P 500 Futures joined the bears’ party with 0.68% losses on a day, down 28.32 points, to 4,134 by the end of Tuesday’s North American trading.

With a 12% jump on the weekly covid cases and India’s heavy contribution, one in every three fresh infections, optimism surrounding the faster economic recovery dashed. Also on the negative side were chatters of travel restrictions by the UK, and the US as well as virus variants from Asia and Japan’s recall of emergency in Tokyo, Osaka and Hyogo.

Read: Coronavirus Update: India leads run-up in global infections, Japan to recall emergencies in Tokyo, Osaka and Hyogo

Other than the covid fears, the US-China and the Russia-Ukraine woes also weighed on the sentiment. Against this backdrop, US Fed Chairman Jerome Powell’s repeat show of conveying inflation and employment commitments were mostly ignored.

It should be noted that the US 10-year Treasury yields dropped to 1.55%, before bouncing to 1.56%, but the US dollar index (DXY) recovered from a seven-week low, which in turn portrayed abnormal sync between the bond and greenback.

Elsewhere, Netflix reported four million new subscribers, way low than market expectations and previous figures, during the Q1 2021 earnings. The disappointment over the much-followed barometer superseded the firm’s ability to mark $7.16 billion, vs $7.13 billion expected, according to Refinitiv data.

Moving on, the earnings season continues to keep the reins while covid updates will also be important amid a light calendar.

 

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