(New York) The New York Stock Exchange closed sharply lower on Wednesday, concerned about the exponential increase in coronavirus contaminations in several US states and its possible consequences for the country's economy.
Published on 24 June 2020 at 9 a.m. 45 Updated to 16 h 57
France Media Agency
Its star index, the Dow Jones Industrial Average fell by 2, 71% to 25 447, 31 points.
NASDAQ, with a strong technological coloring, sold 2, 19 % at 9909,17 points.
The broad S&P index 500 lost 2, 59 % at 3050,33 points.
For Quincy Krosby, head of market strategy at Prudential Financial, “it is not only the increase in the number of cases, but also that of hospitalizations” that is tormenting the market.
Chief White House Immunologist D r Anthony Fauci, s' said Tuesday “really” worried about the “worrying” surges in the number of cases in several US states. “The next two weeks will be critical” to answer it, he said.
The deteriorating health situation poses the threat of a halt to the global and American economic recovery.
In this regard, the International Monetary Fund (IMF) announced on Wednesday a forecast of global recession of 4.9% this year. This is much worse than the 3% expected in April, at the height of the pandemic, when the IMF already stressed that it was the worst crisis since the Great Depression of years 30.
In the United States, GDP is expected to collapse by 8%, well beyond the 5.9% decline estimated in April.
Another reason for concern for the markets: the specter of additional punitive taxes imposed by the United States on the equivalent of $ 3.1 billion of European products, including French, according to an official document published in the night from Tuesday to Wednesday.
The services of the United States Trade Representative have drawn up the list of new products concerned in a call for public consultation which will last until 26 July.
Technical withdrawal
In addition, the stock market, which had grown enormously in recent weeks, made a technical decline on Wednesday.
According to M me Krosby, this is partly linked to the fact that pension funds are in the midst of a rebalancing of their assets as the end of the month approaches.
“The pension fund managers have had good results with their equity portfolio and it is expected that they will sell part of it to invest in the bond market”, explains M me Krosby.
Most of the rates on the American debt were in fact in sharp decline, indicating an increased interest in bonds, whose yield declines when the price of treasury bills rises.
The rate at 10 years was thus 0, 6774% towards 16 h 45, against 0, 7118% Tuesday evening.
Among today's values, the sectors most dependent on an economic recovery have struggled.
American airlines Delta Air Lines (-7, 76%), American Airlines (- 6, 86%) and United Airlines (-8, 34%) ended in decline, as did the cruise passengers Carnival (- 11, 11%), Norwegian Cruise Line (- 12, 37%) and Royal Caribbean (- 11, 26%).
In mass retail, Gap lost 9, 31% And Nordstrom sold 7, 12%.
T-Mobile US is mounted by 1, 19%. The American operator announced Tuesday evening the sale of part of its own shares transferred from SoftBank Group, which it will offer at the unit price of 103 dollars, i.e. a total transaction of approximately 20 billions of dollars.