China COVID cases weigh on Wall St; Disney jumps

  • Disney aware of Iger’s return as CEO
  • S&P 500 energy index leads sector declines
  • Grindr slips after making its skyrocketing debut
  • Tesla down on vehicle recall, China COVID concerns
  • Dow up 0.01%, S&P 500 down 0.34%, Nasdaq down 1.05%

Nov 21 (Reuters) – Wall Street’s major indexes started the week roughly lower on China, saying it faced its toughest test of the coronavirus pandemic, but pared losses after San Francisco Federal Reserve Chair Mary Daly said officials must be careful to avoid a “painful recession”.

Given that markets have priced in a monetary policy framework far beyond what the Fed has imposed on the economy thus far, Daly said Monday “it will be important to remain mindful of this gap between the federal funds rate and the tightening of financial markets”. markets. Ignoring it increases the chances of over-tightening.

As of 2:20 p.m. ET, the Dow Jones Industrial Average (.DJI) was up 37.97 points, or 0.11%, at 33,783.66, the S&P 500 (.SPX) was down 8.85 points, or 0.22%, to 3,956.49 and the Nasdaq Composite (.IXIC) lost 102.38 points, or 0.92%, to 11,043.68.

Beijing said on Monday it would close businesses and schools in hard-hit neighborhoods and tighten rules for entering the city as infections surged, spooking investors. Read more

β€œThere is this fear that China will reinstate some of the COVID restrictions that it has just started to lift,” said Carol Schleif, deputy chief investment officer at BMO Family Office. “That’s part of what’s driving tech stocks down because we’re so reliant on China and Taiwan for critical components.”

US casino operators with operations in China including Wynn Resorts Ltd (WYNN.O), Las Vegas Sands Corp (LVS.N), MGM Resorts International (MGM.N) and Melco Resorts & Entertainment Ltd slid between 2. 5395% and 7.6043%.

Travel stocks, including American Airlines Group Inc (AAL.O) and Norwegian Cruise Line Holdings Ltd (NCLH.N) fell % and 1.2%, respectively.

The S&P 500 energy sector index (.SPNY) slid nearly 3% on Monday to its lowest level in four weeks, as oil prices fell more than 5% after a report that the Saudi Arabia and other OPEC oil producers were discussing an increase in production. The index, however, pared its losses after Saudi Arabia denied talking about it.

Energy was the only major sector in the S&P 500 to expect gains for the year, rising about 63%.

Walt Disney Co jumped 5.7898% after Bob Iger returned as chief executive of the entertainment giant.

The S&P 500 extended its slide from the previous week as several Federal Reserve officials reiterated the central bank’s commitment to raise rates until inflation is brought under control, as investors now wait the publication of the minutes of the Fed’s November meeting on Wednesday.

Traders are broadly betting on a 50 basis point hike at the December meeting, with rates expected to peak in June.

Among other stocks, Tesla Inc (TSLA.O) lost -6.6374% after the electric car maker announced it would be recalling vehicles in the United States over an issue that may have caused the taillights to fail. to light up intermittently.

Gay dating app Grindr (GRND.N) fell amid broader market weakness, after surging on its New York Stock Exchange debut in the previous session.

Trading volumes are expected to be low this week as markets will be closed on Thursday for the Thanksgiving holiday and will be open for half a day on Friday.

Falling issues outnumbered rising ones on the NYSE by a ratio of 1.26 to 1; on the Nasdaq, a ratio of 1.57 to 1 favored the decliners.

The S&P 500 posted 9 new 52-week highs and 2 new lows; the Nasdaq Composite recorded 76 new highs and 194 new lows.

Reporting by Ankika Biswas, Shubham Batra and Shreyashi Sanyal in Bengaluru; Editing by Arun Koyyur, Shounak Dasgupta and Grant McCool

Our standards: The Thomson Reuters Trust Principles.

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