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Wall Street’s main indexes headed for worst week since March

Summary

A tech selloff, surging COVID infections and uncertainty surrounding the election is the perfect storm for a market selloff. Wall Street’s main stock indexes opened in the red on Friday as they headed towards their worst week since March, triggered […]

A tech selloff, surging COVID infections and uncertainty surrounding the election is the perfect storm for a market selloff.

Wall Street’s main stock indexes opened in the red on Friday as they headed towards their worst week since March, triggered by a selloff in tech, soaring COVID-19 cases in the United States and Europe, and growing uncertainty over the outcome of election day, which is only one full trading day away.

In mid-morning trading on Wall Street, the Dow Jones Industrial Average was down more than 184 points or 0.69 percent at 26,474.36.

The S&P 500 – a gauge for the health of US retirement and college savings reports – was down 0.74 percent, while the tech-heavy Nasdaq Composite Index was down 1.51 percent.

The Dow, S&P 500 and Nasdaq are on track to close out their worst week since March.

Investors remain jittery as coronavirus cases surge in the US and Europe, and uncertainty grows over the results of Tuesday’s presidential election. The CBOE Volatility Index – Wall Street’s fear gauge – has been holding at its highest levels since June.

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While President Donald Trump trails his Democratic challenger Joe Biden in the national polls, the race in key battleground states, where the election will likely be determined, is narrowing.

Voters wait in line for a campaign event to hear last-minute arguments from Jill Biden in Westland, Michigan, United States [File: Emily Elconin/Reuters]

The markets were propped up on Thursday after the Bureau of Economic Analysis reported that economic growth bounced back at a record pace in the third quarter.

“IF I AM ELECTED, NEXT YEAR WILL BE OUR BEST EVER!” President Trump wrote on Twitter, boasting about the “BEST IN USA HISTORY” gross domestic product growth of 33.1 percent in the last quarter.

But markets did not stay high on that data for long.

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Tech titans reported their much-anticipated quarterly earnings after the closing bell on Thursday and by Friday morning all but Google’s parent company Alphabet were in the red.

Shares of Apple slid more than 5 percent after it posted the steepest drop in quarterly iPhone sales in two years.

Amazon.com shares were down 3.62 percent after it forecast a jump in costs related to the coronavirus.

Facebook shares shed 5.16 percent as it warned of a challenging coming year.

Twitter’s stock was down 18.43 percent after the site said it registered fewer users than expected and warned that the US election could hit advertising earnings.

Bucking the downward tech trend, shares of Alphabet were up 5.15 percent after it beat forecasts for its quarterly sales as businesses got back to advertising after a COVID-19 slump.

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On the oil and gas front, Exxon Mobil posted a third-quarter net loss was $680m, or 15 cents per share, compared with a profit of $3.17bn, or 75 cents per share, a year earlier. It also said it would cut its global workforce by 15 percent.

Shares of Exxon Mobil were down 1.09 percent.

Oil and gas output has been plundered by the coronavirus pandemic as lockdowns and stay-at-home orders annihilated the demand for energy.

But Chevron posted a surprise third-quarter profit as oil prices bounced back from spring record lows and spending cuts cushioned the bottom line. The second-largest US oil producer reported earnings of $201m, or 11 cents per share, still way down compared with a year before.

Chevron shares were up 0.87 percent.

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