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Summary
- US stock markets failed to sustain the record high peaks on 9 December
- All three major stock indices including Dow Industrials, S&P 500, and Nasdaq ended in the negative territory
- A rout in the shares of heavyweight tech companies steered a nearly 2 per cent plunge in the Nasdaq Composite Index
The US stock markets succumbed to losses on Wednesday, with the key stock indices Dow Jones Industrial Average (DJIA), S&P 500, and Nasdaq recoiling from their respective record highs. A couple of global and domestic factors triggered a renewed wave of pessimism amid the market participants steering the headline indices to settle in the negative territory.
Investors’ sentiments were hammered over the delay in the announcement of a comprehensive economic stimulus to support the ailing businesses, while the pandemic-laden weakness escalated the edginess.
Also Read: Pfizer-BioNTech’s COVID-19 vaccine starts working within ten days of first dose, says FDA
Tech shares bleed
The share prices of tech heavyweight stocks plunged almost 2 per cent in the tech-heavy benchmark Nasdaq Composite on Wednesday. All the top tech companies, including Facebook Inc (NASDAQ:FB), Alphabet Inc (NASDAQ:GOOGL), Amazon.com Inc (NASDAQ:AMZN), Microsoft (NASDAQ:MSFT), Apple Inc (NASDAQ:AAPL), Netflix Inc (NASDAQ:NFLX), and Tesla Inc (NASDAQ:TSLA), were affected. Collectively, these seven blue chip stocks contributed to the negative points with Tesla shares witnessing a sharp fall of close to 7 per cent.
Tesla sees sharpest dip
Tesla shares are set to be inducted in the wider share barometer S&P 500. The S&P Dow Jones Indices is likely to announce the company’s name that Tesla would replace on 11 December. Tesla shares rallied more than 46 per cent in November and have gained 14.50 per cent in December barring these losses. On Wednesday, the stock of Tesla plunged by 6.99 per cent to end at a value of $604.48 a piece.
Facebook trips over lawsuit
The heavyweight stock of Facebook slipped a little less than 2 per cent after the Federal Trade Commission (FTC) along with 46 states sued the social media behemoth for obstructing the competition by acquiring small-scale tech enterprises.
Subsequent to the FTC’s antitrust case, Facebook could land in a position where the media conglomerate has to sell WhatsApp and Instagram, the two most thriving businesses with a wide array of worldwide users.
Following the development, Facebook shares concluded 1.93 per cent lower at $277.92 after falling as much as 4.11 per cent to an intraday bottom of $271.75 from the previous closing of $283.40 per share.
Market-wide fall!
The NYSE-floated DJIA lost 105.07 points, or 0.35 per cent, to end at 30,068.81, the broader indicator S&P 500 posted a drop of 29.43 points, or 0.79 per cent, to finish at 3,672.82, while the tech-dense stock index Nasdaq Composite crashed 243.82 points, or 1.94 per cent, to terminate at 12,338.95 on Wednesday.
DJIA (9 December)
(Source: EODHD/Others, Thomson Reuters)
Uncertainty drags
The volatility and uncertainty due to the pandemic have seemingly resurfaced a dejected tone as the market participants are sceptical about the untroubled roll out of Covid-19 vaccine.
Any material complication in the vaccination programme or severe side effects of the vaccine shot can retrace the markets in the negative territory from their respective multi-month to all-time peaks in the recent past.
The vaccine optimism led rally in the stock markets has triggered a series of gains following which the S&P 500 index inched further closer to the psychological mark of 4,000 as the index has already surpassed the level of 3,700 for the first time in history on 8 December.
