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Benchmarks closed in the red on Friday after investors evaluated the economic impact of coronavirus’ Omicron variant, as central banks in America and Europe move to tighten monetary policies.
The S&P 500 fell 48.03 points, or 1%, to close at 4,620.64 on Friday, dragged into the red with 2.2% decline in the financials and energy sectors. All the 11 major sectors of the broader index closed in the red.
The Nasdaq Composite Index closed at 15,169.68, after declining 10.75 points, or 0.1%, struggling to close in the green. Zoom Video Communications, Inc. (ZM - Free Report) was among Nasdaq’s biggest gainers climbing 9.5%. Gains were overshadowed by decline in tech bigwigs, chipmakers and consumer discretionary stocks.
On Friday, the fear-gauge CBOE Volatility Index (VIX) increased 4.9%, to close at 21.57. Advancing issues outnumbered declining ones on the NYSE by a 1.38-to-1 ratio. Declining issues outnumbered advancers on the NYSE by a 1.50-to-1 ratio. The S&P 500 recorded 22 new 52-week highs and three seven lows, while the Nasdaq Composite posted 28 new highs and 341 new lows.
Quad Witching Day Whipsawed Friday’s Session
Benchmarks stumbled on Dec 17, the third Friday of the last month of the year, also-called quadruple witching day, as investors kept a close watch on the spread of Omicron variant of the coronavirus and digested the Federal Reserve’s hawkish stance in tightening monetary policies. The shift in monetary policy has already been initiated by winding down asset purchases from $15 billion per month to $30 billion per month effective January. Even the European central banks announced plans to further slow purchases of assets under its Pandemic Emergency Purchase Program, in the first quarter of 2022, while the Bank of England announced an interest rate hike leading the benchmark to 0.25% from 0.10%.
Additionally, on the pandemic front, President Joe Biden warned Americans on Thursday evening that the unvaccinated are facing a “winter of severe illness and death”. The omicron variant is spreading rapidly across the country and “and it’s gonna increase”, said Biden at the White House briefing. The World Health Organization also deemed that omicron is clearly more transmissible and reduces the efficacy of vaccines in protecting against infection and raises the risk of reinfection. However, due to the availability of sufficient data people are requested to follow basic protocols and Biden urged unvaccinated Americans to get their shots.
Weekly Roundup
For the week ending Dec 17, the Dow, the S&P 500 and the Nasdaq closed 1.7%, 1.9% and 3% lower, respectively. Investors were worried about the tightening of monetary policy amid the ongoing pandemic, leading benchmarks lower. The Fed has announced plans earlier this week to take up a more aggressive stance to wind down its asset purchases, and said it is looking at multiple rate hikes in 2022.Tech bigwigs registered steep losses, with Microsoft, Apple, and Alphabet closing at least 4% lower for the week.
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Stock Market News for Dec 20, 2021
Benchmarks closed in the red on Friday after investors evaluated the economic impact of coronavirus’ Omicron variant, as central banks in America and Europe move to tighten monetary policies.
How Did the Benchmarks Perform?
The Dow Jones Industrial Average (DJI) fell 532.20 points, or 1.5%, to close at 35,365.44 led into the red with a 3.9% decline in shares of The Goldman Sachs Group, Inc. (GS - Free Report) . The banker carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The S&P 500 fell 48.03 points, or 1%, to close at 4,620.64 on Friday, dragged into the red with 2.2% decline in the financials and energy sectors. All the 11 major sectors of the broader index closed in the red.
The Nasdaq Composite Index closed at 15,169.68, after declining 10.75 points, or 0.1%, struggling to close in the green. Zoom Video Communications, Inc. (ZM - Free Report) was among Nasdaq’s biggest gainers climbing 9.5%. Gains were overshadowed by decline in tech bigwigs, chipmakers and consumer discretionary stocks.
On Friday, the fear-gauge CBOE Volatility Index (VIX) increased 4.9%, to close at 21.57. Advancing issues outnumbered declining ones on the NYSE by a 1.38-to-1 ratio. Declining issues outnumbered advancers on the NYSE by a 1.50-to-1 ratio. The S&P 500 recorded 22 new 52-week highs and three seven lows, while the Nasdaq Composite posted 28 new highs and 341 new lows.
Quad Witching Day Whipsawed Friday’s Session
Benchmarks stumbled on Dec 17, the third Friday of the last month of the year, also-called quadruple witching day, as investors kept a close watch on the spread of Omicron variant of the coronavirus and digested the Federal Reserve’s hawkish stance in tightening monetary policies. The shift in monetary policy has already been initiated by winding down asset purchases from $15 billion per month to $30 billion per month effective January. Even the European central banks announced plans to further slow purchases of assets under its Pandemic Emergency Purchase Program, in the first quarter of 2022, while the Bank of England announced an interest rate hike leading the benchmark to 0.25% from 0.10%.
Additionally, on the pandemic front, President Joe Biden warned Americans on Thursday evening that the unvaccinated are facing a “winter of severe illness and death”. The omicron variant is spreading rapidly across the country and “and it’s gonna increase”, said Biden at the White House briefing. The World Health Organization also deemed that omicron is clearly more transmissible and reduces the efficacy of vaccines in protecting against infection and raises the risk of reinfection. However, due to the availability of sufficient data people are requested to follow basic protocols and Biden urged unvaccinated Americans to get their shots.
Weekly Roundup
For the week ending Dec 17, the Dow, the S&P 500 and the Nasdaq closed 1.7%, 1.9% and 3% lower, respectively. Investors were worried about the tightening of monetary policy amid the ongoing pandemic, leading benchmarks lower. The Fed has announced plans earlier this week to take up a more aggressive stance to wind down its asset purchases, and said it is looking at multiple rate hikes in 2022.Tech bigwigs registered steep losses, with Microsoft, Apple, and Alphabet closing at least 4% lower for the week.