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US: Nasdaq posts another record close; Dow sharply lower
[NEW YORK] The Nasdaq finished at another record on Thursday, but the Dow and S&P 500 retreated as markets weigh the economic toll from the spike in coronavirus cases in many US states.
The tech-rich Nasdaq Composite Index climbed another 0.5 per cent to close at 10,547.75, its fifth record close in the past six sessions.
The Dow Jones Industrial Average dropped 1.4 per cent to end the day at 25,706.09, while the broad-based S&P 500 slid 0.6 per cent to 3,152.05.
The session continued a trend where the market has rewarded technology companies even as it pummels other sectors, including banks, petroleum producers and airlines.
Investors have largely shrugged off the rising number of Covid-19 cases in many US states, although there have been intermittent waves of selling in recent weeks.
A report on Thursday from Goldman Sachs said broad lockdowns in the US may not be needed in light of widening use of face masks, as well as the success of several states to contain the spread of the virus with more limited measures.
"Nevertheless, large risks clearly remain, and further lockdowns cannot be ruled out," Goldman said.
Sam Stovall, chief investment strategist at CFRA Research, attributed Thursday's weakness to spiking coronavirus cases, as well as to a Supreme Court ruling that President Donald Trump must hand over his tax returns to New York prosecutors.
Although Mr Trump's financial records may remain private until after the November election, the ruling marks another strike against the president as the US contends with massive job losses due to the pandemic.
"The market is getting increasing signs that Trump is going to be replaced," Mr Stovall said.
Initial claims for jobless benefits slowed to 1.3 million last week, an exceptionally high number historically speaking, but down 99,000 from the prior week, showing a steady decline as the world's largest economy gradually reopens and workers are recalled to their jobs.
Among individual companies, Walgreens Boots Alliance shares slumped 7.8 per cent as it projected full-year profits well below analyst expectations. Market conditions in Britain are "expected to remain very depressed," the company said.
The outlook is somewhat better in the United States, but profit margins there "are expected to remain compressed" compared to 2019, Walgreens Boots said.
Bed Bath & Beyond plunged nearly 25 per cent as it reported a quarterly loss of US$302 million and announced plans to close 200 stores.