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Stocks reverse to red, oil slips amid Delta variant anxiety

Stock MarketsAug 02, 2021 05:20PM ET
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2/2 © Reuters. FILE PHOTO: A man watches an electric board showing Nikkei index outside a brokerage at a business district in Tokyo, Japan, June 21, 2021. REUTERS/Kim Kyung-Hoon 2/2

By Lawrence Delevingne

BOSTON (Reuters) -U.S. stocks reversed course on Monday to finish slightly lower, echoing a decline in oil and Treasury prices, as economic worries related to the Delta variant of the coronavirus outweighed optimism about infrastructure spending and corporate earnings.

Stocks initially cheered the announcement on Sunday by U.S. senators of around $1 trillion in proposed infrastructure stimulus. A rebound in corporate profits also bolstered the case for owning stocks, even as markets stand near records and economic growth is expected to slow.

Those factors helped push the S&P 500 index to a near all-time high on Monday morning, but the benchmark basket ultimately retreated to lose 8.1 points, or 0.18%, to 4,387.16

The Dow Jones Industrial Average fell 97.31 points, or 0.28%, to 34,838.16, and the Nasdaq Composite added 8.39 points, or 0.06%, to 14,681.07.

The MSCI world equity index, which tracks shares in 49 countries, gained 0.37%.

"The Delta variant still represents the most immediate threat to the outlook," JPMorgan (NYSE:JPM) market strategists wrote in a note on Monday.

But the bank's outlook cited a surprise decline in British and European COVID-19 cases and positive second quarter economic data from the United States and Europe: "Constructive news last week on Delta and growth trims downside risks."

The risks were not lost on other markets, including in energy. Oil prices tumbled about 3% on Monday as weak economic data from China and the U.S., the world's top oil consumers, and higher crude output from OPEC producers stoked fears of weakness in oil demand and oversupply.

Brent settled at $72.89 a barrel, down 3.3% on the day, while U.S. crude fell 3.6% to $71.26 per barrel and .

U.S. manufacturing continued to grow in July, though the pace slowed for the second straight month as spending rotates back to services from goods and shortages of raw materials persist.

Factories around the world are suffering from supply bottlenecks, which sent prices skyrocketing in July, while a new wave of coronavirus infections in Asia demonstrated the fragile nature of the global recovery.

Treasuries Benchmark 10-year notes last rose 18/32 in price to yield 1.1806%, but were still down from 1.239% late on Friday and continuing a multi-month decline.

Negatively interpreting lower Treasury yields, however, could be a mistake, according to Morgan Stanley (NYSE:MS) strategist Guneet Dhingra.

"Investors are fitting a narrative of excessive pessimism to lower yields," Dhingra wrote in a note on Sunday, noting low hospitalizations in Britain from the Delta variant, "suggesting overstated downside risks from COVID-19."

The dollar fell back toward the one-month lows hit last week when it became clear the Fed was in no hurry to tighten policy.

As of late Monday afternoon, the dollar index fell 0.028%, with the euro down 0.02% to $1.1868.

Spot gold dropped 0.1% to $1,812.70 an ounce as an uptick in risk appetite took some shine off the safe-haven metal. U.S. gold futures settled up 0.3% at $1,822.20.

Stocks reverse to red, oil slips amid Delta variant anxiety
 

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Comments (17)
Whaling Trawler
Whaling Trawler Aug 02, 2021 8:26PM ET
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Living outside a major populated area and in the rural countryside will make your anxiety level go down to 0.
Zhikang Sim
Zhikang Sim Aug 02, 2021 8:06PM ET
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Pfizer make a lot of money due covid, however vaccine not really works
Alice Mae Jones
Alice Mae Jones Aug 02, 2021 8:06PM ET
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It does. My son tested positive and I’ve been vaccinated twice with Pfizer. Has kept me from getting infected.
Mubark Adriss
Mubark Adriss Aug 02, 2021 6:47PM ET
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COVID became business for pharmaceutical companies
Dave Jones
Dave Jones Aug 02, 2021 2:29PM ET
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stocks edge up because of covid
Gerald Zhang
Gerald Zhang Aug 02, 2021 11:17AM ET
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we know covid is good for stocks
Ricardo Diogo
Rcd72 Aug 02, 2021 6:08AM ET
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inflation inflation inflation... FED stop the printing machine! stop inflating the market!
Bobster Bambino
Bobster Bambino Aug 02, 2021 6:08AM ET
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Agree completely. With it being likely that covid spread will not effect reopening, fed needs to raise 1/4 basis point right now. Also need to cut back unemployment so people would need to work rather than get handouts as job opportunities are everywhere
Matt Novakovich
Matt Novakovich Aug 02, 2021 6:08AM ET
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don't hate. All people should be even with money
Jody Darden
Jody Darden Aug 02, 2021 6:08AM ET
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Matt Novakovich  They are.. it doesn't matter how much you make if you are horrible with it. This is the world we live in. I only date women who love money.. but it seems like everyone who says they love money is basically broke. So go ahead and avoid people like that. I know people who make a descent amount of money who have a lot in the bank and I know people who make a fortune who live paycheck to paycheck because they are horrible with money. People do not understand that. Money is a tool... not some cup you replenish every Friday or first of the month. Pshhh, unreal
Jody Darden
Jody Darden Aug 02, 2021 6:08AM ET
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I love it when people say. "Well, I've got to raise all these kids with only monthly child support check from their fathers." I say.. Well, you should have thought about that dummmy. Try being responsible, and by the way you're the problem
Vv Pp
Vv Pp Aug 02, 2021 1:36AM ET
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"... intended to reduce inequality and make housing and goods more affordable... " these socialists make me sick, I want Jeff and Elon to rule my life 🤣🤣🤣🤣
Dave Jones
Dave Jones Aug 02, 2021 12:12AM ET
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so blow out earnings and no end for stimulus...how did we get here?
Franco Dominguez
Franco Dominguez Aug 02, 2021 12:12AM ET
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its a mix of various things: china, us debt, hyperinflation, unemployment, not growing, variants
David David
David9 Aug 01, 2021 11:52PM ET
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The title is already propaganda... China is not the worry... we are the worry as we hit debt ceiling..
Max King
Max King Aug 01, 2021 10:06PM ET
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Iceland has over 90% vaccination rate, and recently had to reimpose COVID restrictions as cases surge. Anybody who still believes any of the current political/MSM narrative has to be completely bra.indead. These people, like Fauci, have been wrong every step of the way as they use statistical manipulation to try and comport with their agenda.
Dieter Kaufmann
Dieter Kaufmann Aug 01, 2021 10:06PM ET
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Intreresting; pls give me source your statement thanks
Franco Dominguez
Franco Dominguez Aug 01, 2021 10:06PM ET
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the pfizer vac didnt work cuz freezing levels when you put them in a cooler the vac fail
steven edwards
steven edwards Aug 01, 2021 10:06PM ET
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Dieter Kaufmann  I do not think that I can post links here, but if you search any of the major search engines for keywords "iceland 90% lockdowns" or similar it should point you in the right direction. Essentially Iceland lifted restrictions on June 26, 2021 after majority of the population was vaccinated and reimposed restrictions on July 24, 2021 due to spike in case numbers like everywhere in the world is seeing independent of vaccination rates.
Max King
Max King Aug 01, 2021 10:06PM ET
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steven edwards  Yes, or you can just look at official government data. Over 87% of the population has received at least one dose of the vaccine and they just did lockdowns again.
Investing Man
Investing Man Aug 01, 2021 10:02PM ET
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America's number 1 as always.
Franco Dominguez
Franco Dominguez Aug 01, 2021 10:02PM ET
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so why the dxy fall not the currency is the only asset to probe it
Franco Dominguez
Franco Dominguez Aug 01, 2021 10:02PM ET
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china said something and throw everything in usa: didi, wish,nvda,tencent,uber,lyft,oil, what else!!!
steven edwards
steven edwards Aug 01, 2021 9:31PM ET
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"U.S. earnings shine" LOL...nobody really cares about earnings. The market has gone up in a straight line for over a decade - aside from the COVID dip - because of currency devaluation...zero interest rates and printer goes burrr...that is it. Earnings do not matter when you are dropping the value of the USD 5-10% YoY. For perspective of the bubble, for the first time in US history, the average US household has over 40% of their assets stocks. Retail margin holdings are at historic highs, over $800 billion, and personal debt levels are at historic highs (in addition to historic high levels of corporate/govtt debt). Inflation levels of  USD have never been this high at these historically low interest rates, and government that has been unable to achieve a balanced budget for >20 years, with $30 trillion+ already in debt and threat of default in a few months.
Show previous replies (2)
Investing Man
Investing Man Aug 01, 2021 9:31PM ET
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Careful, your chinese is showing.
Investing Man
Investing Man Aug 01, 2021 9:31PM ET
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divad mocihc You get banned David Wong?
steven edwards
steven edwards Aug 01, 2021 9:31PM ET
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divad mocihc  Are you kidding? I have made a fortune over the past year thanks to the devaluation of the USD. My understanding of the economy and what I typed has nothing to do with where I want to live. I was simply exposing the corrupt that allows individuals such as myself to make wealth while widening the wealth gap and hurting the lower/middle class, policies that democrats like to push as they rely on people being government dependent. Thanks to the economic climate in the US that you seem to love, people like me have made a fortune while working class individuals suffer...but perhaps you are a democrat and like that sort of thing. Just because I made money off it, does not mean that I think it is good...I want to improve the system and not simply promote the corruption to help the stock market and politicians.
steven edwards
steven edwards Aug 01, 2021 9:31PM ET
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divad mocihc  Are you kidding? I have made a fortune over the past year thanks to the devaluation of the USD. My understanding of the economy and what I typed has nothing to do with where I want to live. I was simply exposing the corrupt that allows individuals such as myself to make wealth while widening the wealth gap and hurting the lower/middle class, policies that democrats like to push as they rely on people being government dependent. Thanks to the economic climate in the US that you seem to love, people like me have made a fortune while working class individuals suffer...but perhaps you are a democrat and like that sort of thing. Just because I made money off it, does not mean that I think it is good...I want to improve the system and not simply promote the corruption to help the stock market and politicians...I am not a mar.xist.
David David
David9 Aug 01, 2021 9:31PM ET
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Investing Man I am the real David Wong... lol
Investing Man
Investing Man Aug 01, 2021 9:30PM ET
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You can support a communist country who is shouting superior race nonsense every day. Or you can support choose to be a patriot american.
Sean Livingstone
Sean Livingstone Aug 01, 2021 9:30PM ET
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Chinese has been the most discriminated people, time to be equal to all races, yet,k...k like you think we think we are superior. Go back to your k..k base.
adilio CORTEZ
adilio CORTEZ Aug 01, 2021 9:08PM ET
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hello yes to be able to make the deposit behind the bank account to which site do I have to enter
adilio CORTEZ
adilio CORTEZ Aug 01, 2021 9:06PM ET
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hola buenas noches
Carlos Zubiate
Carlos Zubiate Aug 01, 2021 9:06PM ET
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Hola Edilio
Carlos Zubiate
Carlos Zubiate Aug 01, 2021 9:06PM ET
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No hagas depositos a ninguna persona o cuenta cuidado
Miles Mathewson
Miles Mathewson Aug 01, 2021 8:54PM ET
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Time to buy China heavily (following Buffett's strategy) and start to sell US b4 the FED starts tapering off
 
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