Economic indicators fall, U.S. stocks drop as spread of delta variant ignites worries
By Ishika Dangayach on Aug 10, 2021 | 04:30 AM IST
U.S. stocks dropped on Monday as oil and other sectors
sensitive to economic development fell amid concern about the Covid-19
pandemic.
The Dow Jones Industrial Average fell 0.3 %, while the
S&P 500 fell less than 0.1 %. The Nasdaq Composite, which is heavily
weighted toward technology, gained 0.1 % around 4:00 PM ET.
Brent crude futures fell 1.9 % as China's new steps to
battle the Delta variant of Covid-19 rekindled fears that the virus might harm
energy consumption. Oil prices were further dragged down by data released over
the weekend showing that China bought less oil per day in July than in June,
according to experts. China is the world's top oil importer.
Eight of the S&P's 11 major sectors dropped, while
consumer staples and financials led advances.
Investors were looking for new triggers to propel the market
higher after the S&P 500 and Dow Jones ended last week at record highs due
to good job data.
Following a great earnings season, U.S. equities have surged to new highs in the last two weeks, with numerous big businesses reporting
profits that are above expectations, reinforcing confidence in a post-COVID
economic rebound this year.
According to Refinitiv IBES data, economists anticipated a
93.1 % profit increase for S&P 500 firms in the second quarter. So far,
87.4 % of the 443 companies in the index that have reported profits have
exceeded analyst forecasts, the greatest rate on record, Reuters reported.
Sanderson Farms Inc rose 7.4 % after agreeing to be acquired
for $4.53 billion by commodities trader Cargill Inc and investment company
Continental Grain Co at a time when meat prices are skyrocketing owing to high
demand.
Tyson Foods Inc rose 8.6 % after the meat processing firm
upped its sales projection for fiscal 2021.
Berkshire Hathaway Class A shares gained 0.4 % after Warren
Buffett's conglomerate announced stronger net earnings over the weekend, owing
to growth at its railroad, utilities, and energy businesses.
Bitcoin is up roughly 6.02 % from where it was at 5 p.m. ET
on Friday, it is trading at $46,400 reaching its highest level since May.
As investors continued to follow corporate earnings, AMC Entertainment Holdings Inc, a popular meme stock, is slated to announce results after the
markets close, while Walt Disney Co and Airbnb Inc are expected to report later this
week.
Overseas, the Stoxx Europe 600 index rose 0.21 %, Nikkei 225
climbed 0.3 %. The Hang Seng Index increased 0.4 % and Shanghai Composite Index
soared 1.05 %.
With inputs from WSJ