Dow Falls As U.S. Hits Record Number Of New Coronavirus Cases

The market closed flat on Friday, as investors digested mixed economic data and stocks took a hit from yet another daily record spike in new U.S. coronavirus cases.

The Dow Jones Industrial Average was down 0.2%, nearly 100 points, on Friday, while the S&P 500 rose 0.3% and the tech-heavy Nasdaq Composite gained 0.3%.

New housing starts topped estimates in June, according to data from the Commerce Department, with construction of U.S. homes jumping 17% as some states reopened last month.

Tech stocks have lagged recently, dragging the Nasdaq lower, with shares of companies like Amazon, Microsoft and Facebook all down for the week.

Shares of Netflix tumbled more than 6% after reporting weaker-than-expected second quarter earnings: “Growth is slowing as consumers get through the initial shock of Covid and social restrictions,” the company said.

While the market is on track to finish the week higher, recent gains have come amid a backdrop of surging coronavirus infections across the country: The U.S. reported a new daily record of more than 77,000 cases on Thursday.

Hot spots like Texas, California and Florida accounted for more than half of all new infections on Thursday, with more than 38,700 cases combined.

CRUCIAL QUOTE

“One of the ironies of this recession is that the weakest part of the economy in the previous recession—housing—is now one of the shining stars in an otherwise challenging year,” says Chris Zaccarelli, chief investment officer for Independent Advisor Alliance.

KEY BACKGROUND

Stocks fell on Thursday, snapping a four-day winning streak. Big banks kicked off earnings season earlier this week, with some of the nation’s biggest financial institutions showing massive profit losses—but also surging trading revenues—amid the pandemic. The market also fell on the back of worse-than-expected jobless claims: Another 1.3 million Americans filed for unemployment in the week ending July 11, according to the Labor Department. Earlier this week, stocks got a boost from Moderna’s positive coronavirus vaccine news.

Source: Dow Falls As U.S. Hits Record Number Of New Coronavirus Cases

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