Markets pull back on Washington stalemate
Wall and Bay streets sold off late Tuesday after the Republic Senate leader announced that the latest stimulus talks between his party and the Democrats have hit an impasse. Meanwhile, the rotation out of tech stocks into cyclicals continues in light trading. By the close, the Nasdaq was -1.89%, posting its longest losing streak since early March. The S&P was -0.8%, marking its worst performance since July 23, and the Dow closed -0.38%. The FANG stocks and other tech names sold off. For instance, high-flying Zoom plunged 7.58%. Instead, financials rallied 1.38% with JP Morgan up 3.16%, and travel and leisure names surged. Wynn Resorts jumped 8.36%.
In Toronto, Canadian stocks closed -0.61%. Like the U.S., travel names enjoyed a holiday with Chorus Aviation soaring 8.33%, just two days ahead of its quarterly report. After enjoying gains in recent sessions, energy stocks gave back as the price of WTI and WCS slipped around 1%. However, the losses were greater in gold with the future price of gold plunging nearly 6%, the materials sector losing 5.89%, and the XGD ETF sliding 7.5%. In notable earnings, luxury coat-maker Canada Goose reported a 63% drop in sales due to COVID, and the stock fell 5.67% in trading.
Earlier in the day markets saw a modest lift after Russia’s Putin approved what he claimed to be the first vaccine to combat COVID-19, but the drug has undergone fewer than two months of human testing, far below the accepted global standard. Markets soon desregarded the Russian dictator and scientists debunked his pronouncement.