The New York Stock Exchange fell sharply on Wednesday, shaken by indicators reflecting more strongly than expected the extent of the disaster caused in the United States by restrictive measures intended to limit the spread of Covid-19.
Its flagship index, the Dow Jones Industrial Average, fell 1.86% to 23,504.35 points and the Nasdaq, with its strong technological coloring, by 1.44% to 8,393.18 points.
The S&P 500, which represents the 500 largest companies on Wall Street, dropped 2.20% to 2,783.36 points.
“The much weaker-than-expected data shows how weak the economy has been and investors are arguing that it is much worse than expected,” said Sam Stovall of CFRA.
Retail sales thus fell 8.7% in March in the country compared to February, with in particular a plunge of half of sales of clothing and accessories.
Industrial production fell 5.4% from February, according to data from the United States Federal Reserve (Fed). It was the largest decline since January 1946.
In the New York region, epicenter of the pandemic in the United States, manufacturing activity even dropped in early April to its lowest level in history, said the New York Fed office.
That said, notes Sam Stovall, the indices had climbed a lot on Tuesday thanks to news seeming to show a stabilization of the spread of the virus in certain particularly affected areas, and suggesting a possible reopening of the economy.
“We go up one day, we go down the next day, to come back to roughly the same level, it’s a broker’s paradise,” he said.
Like JPMorgan Chase (-4.96%) and Wells Fargo (-5.77%) on Tuesday, banks Bank of America (-6.49%) and Citigroup (-5.64%) also indicated on occasion of the publication of their quarterly results have had to set aside billions of dollars to deal with possible default by their customers due to the coronavirus crisis.
Bank of America has suddenly announced a plunge of 48.4% year on year to $ 3.5 billion in net profit in the first quarter and Citigroup of 46.5% to $ 2.5 billion.
The investment bank Goldman Sachs (+ 0.16%) for its part saw its net profit divided by almost two to $ 1.1 billion, suffering in particular from a decline in revenues generated by the consultancy activity financial.
– Aid to airlines –
The energy sector, for its part, was affected by a new fall in barrel prices in London and New York, while the International Energy Agency (IEA) estimated that demand for crude oil will suffer this year a “historic” collapse of 9.3 million barrels per day (mbd). The sub-index representing the sector within the S&P 500 plunged 4.67%.
ExxonMobil lost 4.60%, Chevron 2.51% and ConocoPhillips 5.52%.
The airlines, which reached an agreement in principle on Tuesday on a rescue plan intended to avoid their bankruptcy and layoffs of layoffs, recorded contrasting developments.
American Airlines and United Continental appreciated by 2.89% and 3.11% respectively while Delta lost 0.77% and Southwest 5.64%.
The insurer United Health appreciated by 4.13% after having published profits above expectations in the first quarter and having maintained its forecasts for the whole year despite the pandemic.
The chain of electronic goods stores Best Buy fell by 7.29% after announcing the layoff of 51,000 employees from April 19, including almost all part-time.
On the bond market, the 10-year rate on the debt of the United States fell to 0.6348% against 0.7520% dollars the day before at the close.