Stocks slide on Wall Street amid renewed concerns over virus
NEW YORK – Shares fell on Wall Street on Tuesday after the chief of a major vaccine maker expressed concern over the effectiveness of current jabs against the new variant of the coronavirus.
The S&P 500 fell 0.5% at 10:28 a.m. EST. The Dow Jones Industrial Average fell 287 points, or 0.8%, to 34,849 and the Nasdaq was little changed.
Financial companies have some of the biggest losses. Banks have generally fallen along with falling bond yields, hampering their ability to charge more lucrative interest on loans.
The 10-year Treasury yield fell to 1.42% from 1.52% Monday night as investors sought to reduce their exposure to risk. Bank of America fell 1.8% and Discover Financial Services lost 2.9%.
US crude oil prices, which depend on a strong economy, fell 2.8% and weighed on energy stocks. Exxon Mobil fell 1.4%.
The weakness came after Moderna CEO Stéphane Bancel told the Financial Times he expected the current vaccines to fight the omicron variant. Moderna, along with Pfizer and Johnson & Johnson, are making COVID-19 vaccines that have collectively helped bring the pandemic under control through 2021 and allowed the global economy to recover. Moderna fell 5.3%.
This recovery is again threatened by a variant of the virus that appears to spread more easily, although it is not yet clear how more contagious or dangerous it could be. The economy and markets have been hit by a summer flurry of cases of the delta variant, although the impact on the overall recovery has not been very large.
The markets in Europe and Asia also fell. Many countries have put in place travel barriers in an attempt to stem the spread of the omicron variant, which could also hurt global trade. The variant also raises concerns that problems with global supply chains will worsen if factories and ports close.
Investors are also watching the latest round of economic data. The Conference Board reported that consumer confidence fell to its lowest level in nine months in November.
This week’s big economic report will be the Department of Labor’s Friday US employment report. Wall Street will also receive an update on the health of the service sector, which makes up the bulk of the economy, on Friday.
Damian J. Troise, The Associated Press