/Dow plummets 500 points as spiking virus cases prompt more lockdowns
Dow plummets 500 points as spiking virus cases prompt more lockdowns

Dow plummets 500 points as spiking virus cases prompt more lockdowns



US stocks continued their decline on Wednesday as better-than-expected earnings were no match for surges in COVID-19 cases.
European leaders are considering a new wave of lockdown measures following a 40% surge in COVID-19-related deaths over the past week, Reuters reported.
Germany and France are preparing to announce new restrictions on movement in the countries, though the measures might not be as strict as they were earlier in the year, Reuters said. Bars and restaurants in Germany are likely to close while schools, nurseries, and other businesses remain open.
Investor concerns about new restrictions in the US are likely rising too; the country reported record numbers of new COVID-19 cases over the weekend.
Here’s where US indexes stood at 11:05 a.m. ET open on Wednesday:
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The Cboe Volatility Index — or VIX — climbed as high as 38.13, its highest in roughly seven weeks. The VIX has traded at an average of 26.30 since the start of August after registering multiyear highs in March.
While record-high coronavirus cases have fueled concerns about the pace of economic recovery, the prospect of timely fiscal support is all but exhausted. The Senate adjourned on Monday and isn’t set to reconvene until November 9, putting to bed any remaining hope for a stimulus bill. As the recovery slows, some fear that new aid will arrive too late to keep the economy from tumbling again.
Next week’s presidential election has also contributed to the upswing in volatility. While elections typically escalate price swings, the chance of delayed results this year has investors bracing for extended market choppiness.
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In corporate news, First Solar’s third-quarter earnings report bested analysts’ expectations. Deutsche Bank posted a better-than-expected third-quarter profit, and its debt-trading unit posted a 47% surge in business.
The billionaire investor Stanley Druckenmiller said a blue-wave election outcome could hurt stocks in the long term.
Gold lost ground on Wednesday, falling as much as 1.6%, to $1,876.67 per ounce.
Oil prices tumbled. West Texas Intermediate crude fell as much as 6.2%, to $37.11 per barrel. Brent crude, oil’s international benchmark, fell 5.5%, to $38.95 per barrel, at intraday lows.
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