By Will Horner and Paul Vigna
U.S. stocks fell amid concerns about Covid-19 vaccine
distribution and the pace of the economic recovery, while investors
also parsed a bumper day of earnings reports.
The Dow Jones Industrial Average fell 424 points, or 1.4%, and
the S&P 500 dropped 1.8%. The Nasdaq Composite lost 1.6%.
Delays in the rollout of Covid-19 vaccines, coupled with
lingering lockdown measures, marked a "double whammy" of bad news
for investors, said Hani Redha, a portfolio manager at PineBridge
"I think the market expected that by now we would be talking
about loosening, not tightening restrictions," he said. "On the
vaccine rollout, this is very problematic for the near term. It is
very critical for shaping the growth bounce back, and these issues
are just adding more delay to that."
AstraZeneca rebutted reports Wednesday that it had pulled out of
a meeting with European Union officials, as a spat between the two
groups regarding a vaccine shortfall deepened.
The Biden administration said Tuesday it would purchase enough
additional coronavirus shots to vaccinate most of the U.S. with a
two-dose regimen by the end of summer.
While questions about the pace of vaccine rollout and the
economic recovery are real, they aren't new issues for investors,
said Victoria Fernandez, the chief market strategist at Crossmark
Global Investments. Given the market's run to new highs, it's not
surprising that investors are a bit worn out.
"I really think it's a hodgepodge of different things and the
market is saying, you know what, we're taking a breather," she
On Wednesday, investors parsed results from AT&T, Blackstone
and Boeing, with earnings from Apple, Facebook and Tesla due just
after the market closes. Investors are eager to see how the tech
giants fared during a quarter marked by continued lockdowns and
"The bar for tech stocks to beat is quite high because we were
still in lockdown and yet they do seem to be doing well relative to
those higher expectations," said Mr. Redha.
Shares of Microsoft gained 2.8% after the company reported
record quarterly sales Tuesday. Its shares closed at a new high
Walgreens Boots Alliance was up 4.5% after the drugstore chain
named Starbucks operating chief Rosalind Brewer as its next chief
Earnings have pleased the market so far and investors continue
to bet on economic support from the Federal Reserve and a possible
stimulus plan from the Biden administration. On Tuesday, the
S&P 500 hit a new intraday high before slipping in the final
minutes of trading.
"The Fed and the new Biden stimulus plans -- it's all a very
positive backdrop for the equity market," said Brian Walsh, Jr., a
portfolio manager at Walsh & Nicholson Financial Group. "They
are saying we aren't going to let the markets fail right now and,
with bond yields as low as they are, there is nowhere else to
The Fed is expected to leave monetary policy unchanged and
Chairman Jerome Powell will likely underscore the bank's commitment
to supporting the economy with low interest rates and bond buying
for the foreseeable future. Mr. Powell will likely face questions
about the health of the economy and how long the Fed's stimulus
measures will remain in place.
GameStop surged 152% as day traders, propelled by social media,
looked ready to pile into the retailer for another day. The stock
rose 113% Tuesday amid a battle between individual investors and
hedge funds who are shorting the stock. After markets closed
Tuesday, Tesla Chief Executive Elon Musk tweeted "Gamestonk!!" in
an apparent reference to the frenzied trading.
Another target of the day-trader crowd, AMC Entertainment, was
up 222%. If the gains held to the closing bell, it would be the
stock's biggest one-day gain on record.
In commodities markets, U.S. crude rose 0.9% to $53.13 a barrel.
Gold prices fell 0.2% to $1,847.70
Overseas, the pan-continental Stoxx Europe 600 was down 1.2%,
while in Asia, stock indexes were mixed. Japan's Nikkei 225 rose
0.3%, Hong Kong's Hang Seng fell 0.3%, while in mainland China, the
Shanghai Composite edged up 0.1%.
Write to Will Horner at William.Horner@wsj.com and Paul Vigna at
(END) Dow Jones Newswires
January 27, 2021 12:19 ET (17:19 GMT)
Copyright (c) 2021 Dow Jones & Company, Inc.