The Business Times

US: Dow loses 2.1% as Delta variant fears spook stocks

Published Tue, Jul 20, 2021 · 06:05 AM

[NEW YORK] Wall Street stocks fell sharply on Monday on revived worries about the coronavirus and its impact on global growth as governments enact fresh restrictions to counter the Delta variant.

The Dow Jones Industrial Average dropped 2.1 per cent, or about 725 points, to 33,962,04 in its worst session of 2021.

The broad-based S&P 500 shed 1.6 per cent to 4,258.49, while the tech-rich Nasdaq Composite Index declined 1.1 per cent at 14,274.98.

The Delta variant has been in the headlines for weeks, but concerns grew after Los Angeles reimposed an indoor mask mandate over the weekend following a steady increase in Covid-19 infections and hospitalisations.

Australia and Vietnam are among the countries that have announced new restrictions in recent days, joining Japan, where a subdued Olympic Games will get underway in a few days without spectators.

Monday's rout reflects "cumulative effect" of recent headlines, said Art Hogan, chief strategist at National Securities.

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"The market is focused on the coronavirus restrictions and what it means for economic activity. There is very strong muscle memory on what that means."

While the losses were fairly broad-based, travel equities were an especially weak area for stocks. Carnival and United Airlines both dropped more than five per cent, while Marriott International lost 3.1 per cent and Expedia declined 3.8 per cent.

Petroleum-linked shares were another losing realm, with ExxonMobil and ConocoPhillips both falling more than three per cent as the latest agreement of Opec+ producers to modestly boost output hit oil prices.

AFP

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