US stocks on Friday closed lower as investors wrestled with fiscal stimulus developments, concerns over a lengthy rollout of vaccines, and a growing number of state-level shutdowns to combat the spiraling COVID-19 pandemic.
Stay-at-home plays such as Zoom Video Communications Inc and Netflix Inc, which have outperformed throughout the health crisis, helped curb the NASDAQ’s loss.
The Dow Jones Industrial Average fell 219.75 points, or 0.75 percent, to 29,263.48, the S&P 500 lost 24.33 points, or 0.68 percent, to 3,557.54 and the NASDAQ Composite dropped 49.74 points, or 0.42 percent, to 11,854.97.
Throughout the week, the ebb and flow of vaccine news and spiking infections had investors oscillating between economically sensitive cyclical stocks and pandemic-resistant market leaders.
The S&P 500 and the Dow posted marginal losses for the week at 0.73 percent and 0.77 percent respectively, while the tech-laden NASDAQ settled 0.22 percent higher from last Friday’s close.
“Markets are still stuck in a push-and-pull between the dramatic rise of new COVID cases versus apparent progress on vaccines,” said David Carter, chief investment officer at Lenox Wealth Advisors in New York. “This is likely to continue until we have an approved and distributed vaccine.”
US Secretary of the Treasury Steven Mnuchin late on Thursday announced that he would allow key pandemic relief lending programs at the US Federal Reserve to expire at the end of the year, saying that the US$455 billion allocated last spring under the Coronavirus Aid, Relief, and Economic Security Act should be returned to the US Congress to be reallocated as grants for small companies.
The decision to pull the plug on lending programs deemed essential by the central bank comes at a time of spiraling new COVID-19 infections and a fresh wave of layoffs, and was called “disappointing” by Chicago Fed president Charles Evans.
“This dust-up between the Fed and the [US Department of the] Treasury could have serious implications, as markets want to see the two institutions working well together,” Carter said. “The timing of this dust-up is unfortunate, as the risk of COVID is still very much with us.”
Record infection numbers in the US have caused COVID-19 hospitalizations to soar 50 percent and have prompted a new round of school and businesses closures, curfews and social distancing restrictions, hobbling economic recovery from the deepest recession since the Great Depression.
In the latest development in the race to develop a vaccine, Pfizer Inc has applied to the US Food and Drug Administration for emergency use authorization of its COVID-19 vaccine, the first application of its kind in the battle against the disease. The drugmaker’s shares rose 1.4 percent, and provided the biggest lift to the S&P 500.
Of the 11 major sectors in the S&P 500, only utilities eked out a gain by the closing bell. Technology and industrials suffered the largest percentage losses on the day.
Declining issues outnumbered advancing ones on the NYSE by a 1.06-to-1 ratio; on the NASDAQ, a 1.12-to-1 ratio favored advancers.
The S&P 500 posted 17 new 52-week highs and no new lows; the NASDAQ Composite recorded 122 new highs and 10 new lows.
Volume on US exchanges was 10.69 billion shares, compared with the 10.70 billion average over the past 20 trading days.
Additional reporting by staff writer
The Financial Supervisory Commission (FSC) yesterday said it has approved ShopeePay Taiwan Co’s (蝦皮支付) application to operate an electronic payment service in Taiwan, as the third-party payment service provider has to manage higher fund flows due to the rising business of its e-commerce affiliate Shopee Taiwan Co (樂購蝦皮). If a third-party payment service provider’s average daily transactions surpass NT$1 billion (US$34.7 million), it must apply to the commission to become an e-payment company, which is subject to stricter regulations, the commission told a news conference in New Taipei City. ShopeePay handled NT$3.1 billion on average in daily transactions last year, Banking
ARIZONA PROJECT: A spokeswoman said that TSMC appreciates the support from US authorities, which gives it and its partners confidence about future investments City officials in Phoenix, Arizona, on Wednesday approved a slate of financial incentives and government support for Taiwan Semiconductor Manufacturing Co’s (TSMC, 台積電) planned US$12 billion chip plant, a step toward bringing high-tech manufacturing to the US and addressing national security concerns over the industry supply chain. The city agreed to provide about US$200 million to develop roads, sewers and other infrastructure, according to a notice from the city council. At least one additional set of traffic lights would be included for a cost of approximately US$500,000. The company is conducting due diligence on several locations in Phoenix with a final decision to
A.P. Moller-Maersk A/S is planning to launch a US$1.6 billion share buyback program as the world’s biggest container shipping company weathers the COVID-19 crisis better than expected. Copenhagen-based Maersk, which on Tuesday raised its guidance for a second time since last month, reported a 39 percent rise in earnings before interest, taxes, depreciation and amortization to US$2.3 billion in the third quarter. Profit by that measure, before restructuring and integration costs, would reach US$8 billion to US$8.5 billion this year, the company said. Its previous guidance was for US$7.5 billion to US$8 billion. “The global economic environment was [in the third quarter]
OPPORTUNITY: After Huawei said it would sell a sub-brand, potentially exempting it from the US ban, the Hsinchu-based chipmaker eyes the chance to boost sales in China MediaTek Inc (聯發科) yesterday became the nation’s second-most valuable listed company after its market capitalization climbed to NT$1.157 trillion (US$40.23 billion) amid investors’ optimism of new business opportunities, while Hon Hai Precision Industry Co (鴻海精密), a major assembler of Apple Inc’s iPhones, fell one notch to third with a market capitalization of NT$1.153 trillion. The increase in MediaTek’s value came as its shares rallied 4.6 percent to close at NT$728 yesterday, as investors expected the handset chip supplier to benefit from Huawei Technologies Co’s (華為) decision to sell its low-to-mid-range smartphone business under the Honor (榮耀) sub-brand. On Tuesday, Huawei announced