‘Fear Gauge’ Jumps as US Indexes Swoon; Bank Stocks Outperform but Airlines Sink on Travel Restriction Worries
Major US stock indices closed on Monday after mixed nasty two-way trading throughout the session. The catalysts behind the volatile price move were concerns about a new strain of coronavirus in the UK. The news outweighed optimism about a vaccine-induced recovery in economic growth and a new COVID aid package in the US.
In the cash market, the benchmark index S&P 500 was trading at 3694.92 on Monday, down 14.49 or -0.43%. The blue chip Dow Jones Industrial Average closed at 30,216.45, up 37.40, or + 0.14%, and the technology-based NASDAQ Composite ended the session at 12,742.52, down 13.12 or -0 , 12%.
Volatility in US stocks increased as the indices passed out. Although the CBOE Volatility Index, known as Wall Street's "fear measure," fell well below its highs in afternoon trading, it was still on track for its biggest daily gain since late October.
Scroll to continue with the content
Microsoft and Redis
Take part in an exclusive one-day kick-off event.
Register for the event and see what you can do with Azure Cache for Redis.
Financials helped bail out the Dow and the S&P 500 index, gaining more than 1% after the Federal Reserve said major US banks could resume share buybacks.
Goldman Sachs and Morgan Stanley lead the US bank rally after the stress test
U.S. bank stocks outperformed the broader market on Monday, led by Goldman Sachs and Morgan Stanley after the Federal Reserve said stress test results meant the sector was able to buy back shares for the first time since the coronavirus-triggered downturn.
The Fed said the largest US banks had enough capital to sustain over $ 600 billion in losses from a brief, severe economic slump and moderate, prolonged downturn, and could now distribute dividends and buy back shares on a limited base.
Earlier this year, due to the COVID-19 pandemic, the Fed prevented banks from buying back shares to help them build capital reserves.
Goldman stock most recently rose 7.2% after breaking its January high for the first time since the COVID crisis. Morgan Stanley gained 5.9% and was trading at its highest level since September 2007.
US airline stocks fall as new COVID-19 strain fuels fear travel ban fears
U.S. airline stocks fell in premarket trading Monday as a new fast-spreading COVID-19 strain renewed fears of widespread travel bans in the UK. Many countries banned flights from the UK before the main holiday season.
The news comes when U.S. airlines burn $ 180 million in cash every day as passenger traffic has dropped nearly 70% year over year due to restrictions triggered by the pandemic.
Delta shares were down 7% while American Airlines and United Airlines were down 6%. Southwest Airlines lost around 5% in premarket trading.
In our economic calendar you will find all economic events of today.
This article was originally published on FX Empire
More from FXEMPIRE:
Gold Price Prediction - Prices Whipsaw mixed as risk is mixed
Daily GBP / USD Forecast - The US Dollar is gaining ground against the British Pound
FactSet Exceeds First Quarter Earnings And Revenue Estimates; Confirmed 2021 Outlook
EOS, Stellars Lumen and Trons TRX - Daily Analysis - December 22, 2020
Asia Pacific stocks fall as UK new strain of coronavirus threatens global recovery
Technical analysis of the E-mini NASDAQ-100 Index (NQ) Futures - holding the intraday pivot at 12625.25 for the close
In this article
You should check here to buy the best price guaranteed products.
HBO Max Documentary Promises to Expose the "Cult" of Gwen Shamblin Lara After Fatal Plane Crash
Here's How Rihanna Gets Hot & Heavy With Boyfriend A$AP Rocky
Taliban announce hunt for ancient treasure
Fox News reportedly cancels Rudy Giuliani for 3 months, plus his gubernatorial candidate son
Fuel fears spark panic buying at UK gas stations
Five climbers dead after storm on Russia's Mt Elbrus