Dow Jones in reverse: Trump's infection shocks Wall Street

Not good news for investors on Wall Street: US President Trump is catching the coronavirus and the job market is paralyzed with job growth. There is no longer any trace of profit sentiment, especially Tesla shares are plummeting.

Wall Street has shifted back into reverse after two consecutive days of profit. Technology stocks, which are considered very cyclical, came under pressure in particular. Stockbrokers referred to President Donald Trump's corona infection as a burden. In addition, the labor market report for September showed surprisingly low job growth, which also depressed the mood. The leading US index Dow Jones Industrial was mostly in the red and ended up being 0.48 percent lower at 27,682.8 points. On a weekly basis, this results in an increase of 1.87 percent. The market breadth S&P 500 lost 0.96 percent on Friday to 3348.4 points.

The technology-heavy one Nasdaq 100 dropped by 2.83 percent to 11,255.6 points. The recently seen enormous outperformance of tech stocks, which are part of the so-called growth stocks and also the so-called momentum stocks (i.e. stocks with recently high price dynamics), aroused covetousness among many investors, wrote the experts at Quirin Privatbank. In her opinion, technology stocks remain generally promising, but on the other hand they have already anticipated a lot of positive things in current prices.

The president of the world's largest economy is now showing slight symptoms of illness after being infected with the coronavirus. Should Trump not be able to exercise his official duties, Vice President Mike Pence would have to step in. With regard to Trump's corona infection, a market watcher spoke of a "great shock", which naturally reduces investors' willingness to take risks. The US presidential election will take place in just over a month. Because of his quarantine, Trump is now missing out on election campaign events in three important contested US states, with Florida being particularly important, added market strategist Stephen Innes from the trading house Axitrader.

The slow recovery in the labor market is dampening sentiment

Tesla 354.90

In addition, the latest US job report was cited as a drag on the stock market. The labor market continued to recover from its severe slump in the Corona crisis in September. Unemployment fell significantly and employment continued to rise. Wages also increased somewhat. The bottom line, however, is that the government's monthly labor market report points to a slowing pace of recovery. "In the past five months, just half of the jobs lost in the wake of the corona pandemic have been rebuilt," wrote Thomas Gitzel, chief economist at VP Bank. Measured against this, the economic balance sheet looks "devastating" for the US President. "The slow job creation could endanger the re-election of Donald Trump."

Walmart
Walmart 120.24

In the weak environment, stocks fell from Tesla after two days of profit, it was now bottom of the Nasdaq 100 by more than seven percent. The electric car maker had brought more vehicles to customers in the third quarter than expected by the market. According to analyst Joseph Spak from the RBC analysis company, the sales figures could raise some questions. Tesla is expanding its capacities even though the factories are not being used to full capacity. According to stockbrokers, Tesla was unable to dispel demand concerns or doubts about the implementation of long-term corporate goals.

In the Dow, they counted Walmart-Shares with a minus of 1.8 percent among the biggest losers. The retail group wants to sell a large part of its stake in the grocer Asda in Great Britain to investors, but expects a loss in connection with the business in the coming year.

. (tagsToTranslate) Wall Street (t) Donald Trump (t) Corona crisis (t) Labor market