On Monday, U.S. markets plummeted on fears that a resurgence in Covid cases would stifle global economic growth. As the trading session progressed, the selling became more intense, and the Dow Jones Industrial Average recorded its worst day since October. As we see a significant slowdown in earnings and economic growth, the market appears to be poised to take a more defensive stance.
This month has seen a resurgence in covid cases in the United States, with the Delta variant spreading among the unvaccinated. According to CDC data, the United States has averaged about 26,000 new cases per day in the seven days leading up to Sunday, up from a seven-day average of around 11,000 cases per day a month earlier. Because of the Delta variant, cases were already exploding all over the world.
However, Growth equities were able to outperform, which provided some relief. Even when Virgin Galactic (SPCE) shifted course, Boeing (BA) was the weakest blue-chip of the day.
Some of the most noted meme stocks had mixed luck. AMC stock, which made headlines amid a big run-up, fell around 1%. Its relative strength line continues to dip. It comes after the stock tumbled 24% last week, which was its fourth-down week in a row.
GameStop had more luck, managing to close up almost 3%. Nevertheless, GME stock has fallen more than 18% in the past four weeks.
Quick market analysis
The Nasdaq had the best performance of the major indexes, losing only 1.1%. Moderna (MRNA), a Covid vaccination, was the best performer, gaining more than 9%. Peloton (PTON), an at-home exercise game, also did well, climbing roughly 7%. Match Group (MTCH) took the biggest hit, dropping over 5%, with Trip.com (TCOM) following closely behind.
The S&P 500 had a worse day, losing 1.6%. Kroger (KR), a supermarket stock, fared the best, increasing slightly over 4%. Diamondback Energy (FANG) suffered a loss of roughly 7% on a poor day for energy equities.
All of the S&P sectors were in the red, with consumer staples and healthcare suffering the smallest losses. Energy and financials were the hardest hit. The raging bears pushed small caps lower, with the Russell 2000 down 1.5%.
Among the major indexes, the Dow Jones Industrial Average had the poorest luck. Even though it closed off lows, it still lost 2.1%. The stock of Boeing performed the worst, with the Delta variation generating tourism concerns.
