Dow ends nearly 400 points lower, U.S. stocks swoon, on doubts of quick economic recovery

[Mike 03]

MarketWatch
Published: July 7, 2020 at 4:35 p.m. ET

U.S. stocks on Tuesday ended sharply lower, with the S&P 500 snapping its 5-day win streak, as investors grew wary of the economic, public-health and policy response to the coronavirus pandemic.

Equities lost steam after the White House reiterated a call to cap the next round of COVID-19 stimulus at $1 trillion or less, but accelerated their losses in the final hour of trade, after several Federal Reserve officials warned of challenges to the economy as infection rates soar across several states.

How did benchmarks perform?

The Dow Jones Industrial Average DJIA, -1.51% tumbled 396.85 points, or 1.5%, to end at 25,890.18, the S&P 500 index SPX, -1.08% shed 34.40 points, or 1.1%, closing at 3,145.32 and end a 5-session win steak; while the Nasdaq Composite Index COMP, -0.86% fell 89.76 points, or 0.9%, to finish at 10,343.89, after carving out an intraday 10,518.98 record.

On Monday, the Dow gained 459.67 points, or 1.8%, to end at 26,287.03. The S&P 500 climbed 49.71 points, or 1.6%, ending at 3,179.72 and matching its longest win streak, five straight sessions, since the period ended Dec. 17; while the Nasdaq surged 226.02 points, or 2.2%, to 10,433.65, scoring its third straight record and its 24th of the 2020.

What drove the market?

Nagging unease over the outlook for the global economy in the midst of rising U.S. coronavirus infections helped dampen the buying mood on Wall Street.

Read more: https://www.marketwatch.com/story/dow-pulls-back-240-points-after-previous-days-rally-2020-07-07

[SoonerPride]

1. But why is today different than the last 3 months?

The market cratered and then has been on a steady uphill climb against all economic reason.

I have given up trying to think the market is rational

It certainly isn’t the economy.

And it isn’t tethered to reality anymore either.

[jimfields33]

2. Cratered? Not really.

I wanted to buy today but my stocks I wanted to buy didn’t go down enough. Hopefully tomorrow. I have money in the stock bank ready to go but won’t move until the price is right.

[SoonerPride]

4. It cratered weeks ago. Not today.

When it slipped below the point when trump
Took office.

That’s what I was referring to.

It fell dramatically and has climbed back to where it was despite the virus and its impacts on the economy continuing unabated.

[jimfields33]

5. Got it.

[soothsayer]

3. Maybe creating an army of mini super spreaders has the markets worried?

Idk, it’s irrational .... unless you’re an insider driving it this way or that

[Johnny2X2X]

6. It's just erratic

I swear, I’ve followed the markets and metrics that usually predict the market direction, but this year it’s like the markets have the attention span of a 3 year old. Whatever sliver of hope they find is all they can think of in the moment and they go up. And the same with with going down.

Fact is, it’s way overvalued right now. When the crash comes is anyone’s guess though.

[ck4829]

7. It's a recession, it's a recession