After an extended session rally higher to charter fresh recent highs, equities reversed sharply in opening trade Tuesday as a decline in tech shares overcame some of the enthusiasm around the potential reopening of some states in the U.S.
The Dow Jones Industrial Average was essentially flat, after starting the session 378 points higher, and at one point dipped 100 points. The S&P 500 fell 0.3% after also starting the session almost 40 points higher, while the Nasdaq Composite sank 1.1% but is trading around 0.87% down as of almost 1 pm EST.
Stock index ETFs also relinquished early gains, with the SPDR S&P 500 ETF Trust (SPY) off 0.13%, while the SPDR Dow Jones Industrial Average ETF (DIA) is flat and the Invesco QQQ Trust (QQQ) dropped 1.46%.
With news yesterday that New York is looking at a path to reopen the economy and there may be a partial reopening of the economy in states like Alaska, Georgia, South Carolina, Tennessee, Texas, investors drove stocks higher, as investor sentiment improved, with certain U.S. businesses set to gain from the first group of consumers emerging from shelter-in-place restrictions.
News from China that the coronavirus continues to plague the nation, and is likely to return annually to infect individuals globally has sobered markets somewhat and could be contributing to the downdraft in stocks as well.
According to Chinese experts, unlike the SARS epidemic, where those infected became seriously ill, yet once they were quarantined from others, the virus stopped disseminating, China is still finding dozens of asymptomatic cases of the coronavirus every day despite stemming its epidemic.
“This is very likely to be an epidemic that co-exists with humans for a long time, becomes seasonal and is sustained within human bodies,” said Jin Qi, director of the Institute of Pathogen Biology at China’s top medical research institute, the Chinese Academy of Medical Sciences.
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