Dow, S&P 500 Slide After Big Selloff
By Mischa Frankl-Duval and Amber Burton
U.S. stocks wobbled Tuesday, attempting to stabilize after
worries about the coronavirus pandemic sent markets tumbling to
start the week.
Rising Covid-19 infection levels around the world are
compounding worries about the global economic outlook. The
seven-day average of new cases in the U.S. reached a record Monday,
while a number of countries in Europe, including Italy, Spain and
Russia, tightened restrictions on activity to try to curb the
spread of the virus.
One factor that has helped stocks bounce back from selloffs in
the past: evidence that parts of the economy have started to
recover from disruptions and shutdowns related to the pandemic.
Orders for long-lasting factory goods increased for the fifth
consecutive month in September, Commerce Department data showed
Tuesday. Orders rose 1.9% in September from August.
The Dow Jones Industrial Average fell 222.19 points, or 0.8%, to
27463, down four of the past five trading days. The blue chips are
down 3.8% for 2020. The S&P 500 lost 10.29 points, or 0.3%, to
3390.68. The Nasdaq Composite climbed 72.41 points, or 0.6%, to
Technology stocks were a relative bright spot in Tuesday's
market, buoyed by Advanced Micro Devices' planned $35 billion
acquisition of Xilinx, a fellow chip maker. Xilinx shares rose
$9.80, or 8.6%, to $124.35. AMD fell $3.35, or 4.1%, to $78.88.
Despite uncertainty due to the rise in Covid-19 infections,
Craig Fehr, an investment strategist at Edward Jones, said he
remains optimistic about the market's recovery heading into next
"I think there are still more gains that can be seen in 2021.
We're probably likely to see the stock market produce both
volatility and returns that are a bit more consistent with
historical norms," he said.
Some investors also are betting that authorities will avoid the
stringent lockdown measures put in place in the spring to slow the
spread of the virus, which brought the global economy to a jarring
"At the moment, the market is discounting for further lockdowns
and for the economy to suffer dramatically again, and I just don't
see that," said Patrick Spencer, managing director at U.S.
investment firm Baird. "We're in a V-shaped recovery."
A string of earnings results drove swings across the stock
Shares of Eli Lilly fell $9.80, or 6.9%, to $131.90, after the
drugmaker lowered its profit guidance for 2020. Shares of
Caterpillar fell $5.29, or 3.2% to $157.91, after the company
reported profits and revenue fell during its most recent
After the closing bell, Microsoft reported higher sales fueled
by pandemic-era demand for cloud-computing services. Shares ticked
up 0.3% after hours. Other big tech companies, including Apple and
Amazon.com, are set to report later this week.
Overseas, the Stoxx Europe 600 slipped 0.9%.
In Asia, most major equity benchmarks posted tepid declines.
Hong Kong's Hang Seng Index retreated 0.5% and Japan's Nikkei 225
was little changed, while the Shanghai Composite Index ticked up
Write to Mischa Frankl-Duval at Mischa.Frankl-Duval@wsj.com
(END) Dow Jones Newswires
October 27, 2020 17:23 ET (21:23 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.