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Wall Street ends lower on worries over Georgia elections, virus surge

Stock Markets Jan 04, 2021 04:30PM ET
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By Gertrude Chavez-Dreyfuss

NEW YORK (Reuters) -Shares on Wall Street closed sharply lower on Monday, sliding from all-time peaks on the first trading day of the year, as risk appetite ebbed amid upcoming runoff elections in Georgia and the persistent surge in coronavirus cases.

The Dow, which touched a record high earlier in the session along with the S&P 500, was also dragged down by a more than 4% fall in Boeing (NYSE:BA) Co's shares after Bernstein cut its rating to "underperform," citing concerns about cash flow.

All three main indexes hit two-week lows, with record highs in the Dow and S&P 500 extending a 2020 rally fueled by monetary stimulus and the start of vaccine rollouts.

The fate of U.S. President-elect Joe Biden's agenda, meanwhile, including rewriting the tax code, boosting stimulus and infrastructure spending hinges firmly on Tuesday's twin Senate races in the battleground state of Georgia that will determine control of the chamber.

Wall Street's fear gauge touched a two-week high on Monday.

"Stocks are pulling back from a stunning year of gains," said Brian Reynolds, chief market strategist, at Reynolds Strategy.

"We're starting off with a virus out of control. We'll probably going to end 2021 with a virus that could be under control by that time. How we get from start to finish will be filled with frequent pullbacks because people will be looking at short-term headlines," he added.

Total U.S. deaths from COVID-19 have reached more than 350,000.

Almost all S&P sectors dropped with real estate, utilities and industrials posting the sharpest percentage declines. Consumer discretionary and materials hit all-time highs in early trading.

The Dow Jones Industrial Average fell 382.59 points, or 1.25%, to 30,223.89, the S&P 500 lost 55.42 points, or 1.48%, to 3,700.65 and the Nasdaq Composite dropped 189.84 points, or 1.47%, to 12,698.45.

The S&P 500 and the Dow posted their largest daily percentage falls since late October, while the Nasdaq had its biggest loss since Dec. 9.

"Investors are at a point where they want to take a breather while they assess all the different things coming in the new year," said Lindsey Bell, chief investment strategist at Ally Invest, in Charlotte, North Carolina.

On the data front, U.S. manufacturing activity picked up at its briskest pace in more than six years in December, a survey showed on Monday. It comes on the heels of upbeat factory activity surveys across Europe and Asia earlier in the day.

Some investors are cautious about the pace of economic growth as U.S. jobless claims remain stubbornly high, while a new round of pandemic-related restrictions last month and a new variant of the coronavirus have cast a shadow on the outlook.

Tesla (NASDAQ:TSLA) Inc's shares extended a meteoric rally to scale a record high after the electric-car maker reported better-than-expected vehicle deliveries in 2020.

Shares of FLIR Systems Inc (NASDAQ:FLIR) jumped more than 19%after Teledyne Technologies (NYSE:TDY) Inc agreed to buy the thermal imaging camera supplier for $8 billion in cash and stock. Teledyne's shares, however, dropped 7.5%.

Declining issues outnumbered advancing ones on the NYSE by a 2.14-to-1 ratio; on Nasdaq, a 1.43-to-1 ratio favored decliners.

The S&P 500 posted 54 new 52-week highs and no new lows; the Nasdaq Composite recorded 151 new highs and 19 new lows.

Volume on U.S. exchanges hit 14.15 billion shares, compared with the 10.94 billion average for the full session over the last 20 trading days.

Wall Street ends lower on worries over Georgia elections, virus surge
 

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Comments (18)
perplexed76 .
perplexed76 . Jan 05, 2021 1:45AM ET
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i like the virus. It doesn't give low quality politicians a break. We see that 99% of world leaders are incompetent ******
Andre Viparich
Andre Viparich Jan 04, 2021 10:24PM ET
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Babadation
Ali Azari
Ali Azari Jan 04, 2021 5:47PM ET
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nc ing
nc ing Jan 04, 2021 3:00PM ET
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MAX787, a new plane.?
Southern Tiger
Southern Tiger Jan 04, 2021 1:56PM ET
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Welcome to the world of the Democratic Party! They want to give everyone else's money except theirs to everyone else.
Robert Nchor
Robert Nchor Jan 04, 2021 1:56PM ET
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Lol did the publicans ever give their own money to anyone? Or we should keep giving tax breaks to the wealthy who are laying off the poor people?
Southern Tiger
Southern Tiger Jan 04, 2021 1:55PM ET
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Welcome to the world of the Democratic Party! They want to give everyone else's money except theirs to everyone else.
katya litski
katya litski Jan 04, 2021 1:48PM ET
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lol. rolls eyes
Lucas Leonardo
Lucas Leonardo Jan 04, 2021 1:47PM ET
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Now is the Time To BUY!
Sun Moon
Sun Moon Jan 04, 2021 1:44PM ET
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So who flipped the coin and chose "Georgia runoff" as the reason for today's decline? And , is it a quarter, or something larger? Isn't it odd that the market seemed to welcome Harris-Biden as president, but is suddenly "nervous" over the Georgia runoff.
Tommy Arencibia
Tommy Arencibia Jan 04, 2021 1:32PM ET
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I guess Reuters got tired of running the same article... “Markets down due to covid cases concerns”. The GA elections seem easier to go with today.
 
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