BackWall St update: Boeing, travel stocks pull US stocks lower as COVID cases rise
Seven of the 11 S&P indexes were down, with investors piling into defensive stocks that are considered relatively safe during times of economic uncertainty: real estate, utilities , consumer staples and healthcare
PremiumWall Street's main indexes fell for a second straight day on Tuesday as a spike in coronavirus cases globally hit travel stocks, while Boeing slid on the unexpected departure of its finance chief.
Seven of the 11 S&P indexes were down, with investors piling into defensive stocks that are considered relatively safe during times of economic uncertainty: real estate, utilities , consumer staples and healthcare.
Shares of airline operators and cruiseliners including JetBlue Airways, American Airlines, Norwegian Cruise Line and Carnival Corp, which were hammered last year as widespread lockdowns led to a halt in global travel, fell between 5% and 9%.
"Rising COVID-19 cases around the world is a risk," said Paul Nolte, portfolio manager at Kingsview Asset Management in Chicago.
"Investors may be taking a little bit of profit as they recognize that a lot the 'reopening trade' may already be priced in to the markets at this point."
Wall Street's main indexes scaled record highs last week as investors bet on stocks such as industrials and miners that are deemed to benefit from a faster-than-expected economic rebound, while richly valued technology stocks found favor after a retreat in bond yields.
On Tuesday, the technology-heavy Nasdaq, which comprises some of the best performing stocks from last year including Apple Inc and Tesla Inc, was down 0.9% even as Treasury yields ticked lower.
The CBOE volatility index, known as Wall Street's fear gauge, rose above 19 points for the first time since March 31.
At 12:25 p.m. ET, the Dow Jones Industrial Average was down 0.64%, the S&P 500 was down 0.66% and the Nasdaq Composite was down 0.91%.
Boeing Co fell 4% after it announced the unexpected retirement of its chief financial officer for the past decade, Greg Smith.
Nike Inc dropped 4.2% and was among the top drags on the blue-chip Dow after Citigroup lowered its rating on the company's shares to "neutral" from "buy".
Focus turns to quarterly earnings reports from technology heavyweights after a blockbuster set of results last week from big banks.
Shares of video-streaming service provider Netflix, which thrived during last year's lockdowns, fell about 1.1% ahead of its results after the closing bell.
International Business Machines Corp rose 4.2% after recording the biggest rise in quarterly sales in more than two years.
Overall, analysts expect first-quarter earnings S&P 500 firms to have jumped 31.5% from a year earlier, according to Refinitiv IBES data.
United Airlines slumped about 9% after reporting a bigger-than-expected adjusted net loss. Its shares dragged the S&P 1500 airline index down 5.5%.
Kansas City Southern jumped 16% to a record high after Canadian National offered to buy the U.S. railroad operator for about $30 billion, trumping a rival bid by Canadian Pacific.
Declining issues outnumbered advancers 3.09-to-1 on the NYSE and 3.42-to-1 on the Nasdaq.
The S&P index recorded 56 new 52-week highs and no new low, while the Nasdaq recorded 40 new highs and 93 new lows.
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This story has been published from a wire agency feed without modifications to the text. Only the headline has been changed.
