The Dow and S&P 500 fell on Friday as fears of new shutdowns to limit the spread of the coronavirus in Europe weakened banking, energy and airline stocks, while strength in technology pushed the Nasdaq index to a record high.
In Europe, the emergence of coronavirus cases has seen Austria appear to outline plans for a full lockdown, and fears that Germany could follow suit amid a new wave of infections that have rocked stock markets globally.
Banking shares declined by 2.6%, tracking the decline in treasury bond yields as investors snapped up safe haven bonds.
The financial sector was among the worst-performing S&P sectors for the day, down 1.7%, and airlines including Delta Airlines, United Airlines, American Airlines and Norwegian Cruiseliners were down 1.3%.
Major oil companies fell as crude oil prices fell due to renewed concerns about European demand, which led to a decline in the energy sector in Standard & Poor's by 3.4%, and Tom Mantion, managing director, UBS Private Wealth Management in Stamford, Connecticut, said: There are some risks of the epidemic.
However, I don't think the United States will go in the same direction as Austria. If Germany imposes a complete lockdown, this will likely have an impact, once again, on the supply chain.
Inflation remains a top priority for investors, with recent comments from Federal Reserve officials indicating that inflation is becoming broad-based and expectations for future price hikes are rising, and lower returns have supported major technology stocks, which in turn pushed the Nasdaq index up to a record high.
Declining issues outnumbered advanced stocks by 1.47 to 1 on the NYSE and 1.05 to 1 on the Nasdaq, the S&P 33 recorded a new 52-week high and four new lows, while the Nasdaq 52 recorded a new high and 141 new lows