Dow closes down 940 points as fears grow over virus surge fallout

Wall Street’s fear gauge spiked to its highest level since June as concerns mount over surging COVID-19 cases in the United States and Europe – and uncertainty over the outcome of the Nov 3 US presidential election

The Dow Jones Industrial Average on Wednesday shed more than 943 points or 3.43 percent to finish the session at 26,519.95 [Carlo Allegri/Reuter]
The Dow Jones Industrial Average on Wednesday shed more than 943 points or 3.43 percent to finish the session at 26,519.95 [Carlo Allegri/Reuter]

Wall Street’s main stock indexes all closed down on Wednesday as rising coronavirus infections in the United States and Europe fuel fears of more growth-sapping coronavirus pandemic restrictions and investors fret over the prospect of a contested November 3 US presidential election.

The Dow Jones Industrial Average shed more than 943 points or 3.43 percent to finish the session at 26,519.95

The S&P 500 – a gauge for the health of US retirement and college savings reports –  closed down 3.52 percent while the tech-heavy Nasdaq Composite Index ended the session down 3.73 percent.

The CBOE Volatility Index (VIX), also known as Wall Street’s “fear gauge”, spiked to its highest level since June.

Spiraling COVID-19 cases in Europe led German Chancellor Angela Merkel and French President Emmanuel Macron on Wednesday to order their countries back into limited lockdowns.

The spectre of renewed restrictions in the US looms large as infections and hospitalisations set records in the US Midwest.

Meanwhile, Washington continues to squabble over the scope of the next round of virus relief aid. The impasse could leave millions of out-of-work Americans and struggling businesses entering the cold and flu season – and another round of possible restrictions – without additional federal support.

It is unlikely that a deal will be struck before Election Day, which also brings its own set of concerns.

It remains entirely possible that the US will not have a clear winner when polls close on Tuesday and or that the results could be challenged.

Concerns are mounting over the possible delay in counting a large number of mail-in ballots.

 

President Donald Trump’s Democratic rival Joe Biden is leading in national polls, but the race has tightened in key battleground states, which are likely to determine the winner.

Trump took to Twitter on Wednesday morning to throw shade on the media, accusing it of engaging in a “unified chant” and up-playing the threat of the virus to sway election results.

“They will talk about nothing else until November 4th, when the Election will be (hopefully!) over. Then the talk will be how low the death rate is, plenty of hospital rooms, & many tests of young people,” Trump wrote.

Travel and leisure stocks were hard hit on Wednesday. Worldwide, the travel and services industries have borne the brunt of COVID-19 restrictions.

New York City’s century-old Roosevelt Hotel announced it will close at the end of October due to ongoing losses associated with the coronavirus pandemic [File: Carlo Allegri/Reuters]
Mass layoffs in the travel industry continue with more furloughs and pink slips on the horizon.

In a memo to employees on Wednesday, Boeing’s Chief Executive Dave Calhoun said the company expects to eliminate some 30,000 jobs through buyouts, layoffs and attrition by the end of 2021 – more than originally forecast.

The news hit the same day as the aerospace giant reported its fourth straight quarterly loss as the COVID-19 pandemic and the ongoing 737 MAX grounding hammers its bottom line.

Shares of Boeing closed down 4.57 percent.

Shares of Facebook, Twitter and Google parent Alphabet all shed more than five percent on Wednesday after the CEOs of the tech giants were grilled by Republican Senators on Wednesday over how content is policed on their social media platforms.

Source : Al Jazeera

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