Wednesday U.S. shares fell to another session as investors were discouraged by Federal Reserve Chairman Jerome Powells downbeat comments about the economy. Powell warned of a long period of weak growth and stagnant incomes due to the coronavirus pandemic. And he said further fiscal stimulus should be provided to prevent long-term economic damage.
Meanwhile, the Fed chief said the central bank would not push interest rates below zero.
The Dow Jones industrial average dropped 516 points (-2.2%) to 23248, the S&P 500 lost 50 points (-1.8%) to 2,820, and the Nasdaq 100 was down 112 points (-1.2%) to 9,000.
Automobiles & Components (-5.27%), Banks (-4.41%) and Energy (-4.39%) lost the most.
Coty (COTY -15.5%), National Oilwell Varco (NOV -10.7%), Under Armor (UAA -9.7%), Norwegian Cruise Line (NCLH -7.0%) and Salesforce.com (CRM -4.5 %) were the biggest losers.
On the other hand, BlackRock (BLK + 6.9%), Regeneron Pharmaceuticals (REGN + 3.5%), Newmont Goldcorp (NEM + 2.3%) and Equinix Inc (EQIX + 2.3%) have made gains.
On the technical side, approx. 25.8% (29.9% in the previous session) of stocks in the S&P 500 index above their 200-day moving average and 44.4% (64.9% in the previous session) were above their 20-day moving average.
The VIX index – Wall Street’s fear gauge – rose 2.21 points (+ 6.7%) to 35.25, its highest level since May 4.
US official data showed that the producer price index fell 1.3% in the month of April (-0.5% expected).
Later today, the original unemployment claims for the week ending May 9 ($ 2.5 million expected) and the April import price index (-3.2% for the expected month) are reported.
European stocks returned to negative territory, with the Stoxx Europe 600 index losing 1.9%. Germany’s DAX fell by 2.6%, France’s CAC fell 2.9%, and Britain’s FTSE 100 dropped 1.5%.
U.S. Treasury prices remained firm as the benchmark 10-year Treasury yield fell 4.2 basis points to 0.648%.
The spot gold price jumped $ 13 or 0.8% to $ 1,715 per share. Ounce.
Oil prices came under pressure when Powell pointed out that the economic outlook was very uncertain. US WTI crude oil futures (June) slipped 1.9% to $ 25.29 per share. Barrel.
On the forex front, ICE U.S. The dollar index rose 0.2% on the day to 100.20. Federal Reserve Chairman Jerome Powell said they are not considering negative interest rates, despite a very uncertain outlook and significant downside risks.