S&P 500   4,538.43
DOW   34,580.08
QQQ   383.13
S&P 500   4,538.43
DOW   34,580.08
QQQ   383.13
S&P 500   4,538.43
DOW   34,580.08
QQQ   383.13
S&P 500   4,538.43
DOW   34,580.08
QQQ   383.13

Asian shares fall on virus variant worries, Wall St retreat

Tuesday, July 20, 2021 | Yuri Kageyama, AP Business Writer


A man walks past a bank's electronic board showing the Hong Kong share index at Hong Kong Stock Exchange Tuesday, July 20, 2021. Asian shares fell Tuesday as worries grow that a faster-spreading variant of the coronavirus could upend the global economic recovery. (AP Photo/Vincent Yu)

TOKYO (AP) — Asian shares fell Tuesday as worries were growing that a faster-spreading variant of the coronavirus could upend the global economic recovery.

Japan's benchmark Nikkei 225 slipped 0.9% to 27,417.75. South Korea's Kospi shed 0.6% to 3,226.19. Australia's S&P/ASX 200 declined 0.5% to 7,252.20. Hong Kong's Hang Seng lost 1.1% to 27,189.43, while the Shanghai Composite fell 0.2% to 3,531.54.

Worries about the pandemic continue in Japan, with three days to go before the Tokyo Olympics open. Some 11,000 athletes are taking part in the Games, and 22,000 other people have arrived since July 1 to take part in the Games.

Several athletes and more than 60 other non-athletes affiliated with the Games have tested positive. Fears are growing that, despite repeated tests, infections may spread.

The vaccination rollout has been slower in Japan than in other developed nations, with just 22% of the population fully vaccinated. Reports that fully vaccinated people have gotten infected are another cause for worry. The Japanese government has repeatedly promised “a safe and secure" Games.

On Wall Street, the S&P 500 fell 1.6% to 4,258.49, after setting a record just a week earlier. In another sign of worry, the yield on the 10-year Treasury touched its lowest level in five months as investors scrambled for safer places to put their money.

The yield on the 10-year Treasury was steady at 1.21% after falling to 1.20% Monday from 1.29% late Friday. In March it was at roughly 1.75%.

The Dow Jones Industrial Average slumped 2.1% to 33,962.04, while the Nasdaq composite lost 1.1% to 14,274.98.

Airlines and other companies that would get hurt the most by potential COVID-19 restrictions took some of the heaviest losses, similar to the early days of the pandemic in February and March 2020. United Airlines lost 5.5%, mall owner Simon Property Group gave up 5.9%, and cruise operator Carnival fell 5.7%.

The World Health Organization says cases and deaths are climbing globally after a period of decline, spurred by the highly contagious delta variant. And given how tightly connected the global economy is, a hit anywhere can quickly affect the other side of the world.

Even in the U.S., where the vaccination rate is higher than in many other countries, people in Los Angeles County must once again wear masks indoors regardless of whether they're vaccinated following spikes in cases, hospitalizations and deaths.

Any worsening of virus trends threatens the high prices that stocks have achieved on expectations the economy will fulfill those lofty forecasts.

“It’s a bit of an overreaction, but when you have a market that’s at record highs, that’s had the kind of run we’ve had, with virtually no pullback, it becomes extremely vulnerable to any sort of bad news," said Randy Frederick, vice president of trading & derivatives at Charles Schwab. “It was just a matter of what that tipping point was, and it seems we finally reached that this morning” with worries about the delta variant.

He and other analysts are optimistic stocks can rebound quickly. Investors have been trained recently to see every dip in stocks as merely an opportunity to buy low.

Barry Bannister, chief equity strategist at Stifel, was more pessimistic. He says the stock market may be in the early stages for a drop of as much as 10% following its big run higher. The S&P 500 nearly doubled after hitting its bottom in March 2020.

“The valuations, they just got too frothy," he said. “There was just so much optimism out there.”

Besides the new variants of the coronavirus, other risks to the economy include fading pandemic relief efforts from the U.S. government and a Federal Reserve that looks set to begin paring back its assistance for markets later this year.

Monday's selling pressure was widespread, with nearly 90% of the stocks in the S&P 500 lower. Even Big Tech stocks fell, with Apple down 2.7% and Microsoft 1.3% lower.

This week also brings a slew of earnings reports. Across the S&P 500, analysts are forecasting profit growth of nearly 70% for the second quarter from a year earlier. That would be the strongest growth since 2009, when the economy was climbing out of the Great Recession.

In energy trading, benchmark U.S. crude rose 10 cents to $66.52 a barrel in electronic trading on the New York Mercantile Exchange. Brent crude, the international standard, added 40 cents to $69.02 a barrel.

In currency trading, the U.S. dollar rose to 109.52 Japanese yen from 109.46 yen. The euro fell to $1.1779 from $1.1802.

___

AP Business Writers Stan Choe, Alex Veiga and Damian J. Troise contributed.


7 Tech Stocks That Are Heating Up as Anti-Trust Talk Cools Down

For the better part of the last year, Congress has had “big tech” in its crosshairs. But the reasons why largely depend on what side of the aisle a particular individual was on.

On the one hand, there are politicians who are concerned about the role that technology companies play in restricting the free flow of information. On the other hand, there are politicians that are concerned about these companies' stranglehold on competitors and innovation.

But big tech scored an important, albeit not final, victory in late June. At that time, a U.S. judge dismissed two separate complaints against Facebook (NASDAQ:FB). The question in front of the judge was whether Facebook held a monopoly on social media. Due to a surge in the company’s stock price after the ruling, Facebook became a member of the exclusive $1 trillion market cap club. While big tech companies will remain under the Congressional microscope, there’s no denying that investors are looking at the ruling as a signal to rotate back into tech stocks. And that’s the focus of this presentation. What tech stocks should you be buying as anti-trust pressure eases?

It would be easy to start and end the list with the FAANG stocks. After all, the motto “Keep it Simple Stupid” comes to mind. There are simply those companies that offer products that are changing our lives now and will continue to do so in the future. And furthermore, customers will continue to pay for their products.

And I do have a couple of these stocks on my list. But the bulk of the stocks on this list are less expensive alternatives to at least one of the FAANG stocks. It doesn’t mean they’re superior companies, but a rising tide tends to lift all boats. And that means these companies have a large upside and you can purchase the stocks for a lot less.

View the "7 Tech Stocks That Are Heating Up as Anti-Trust Talk Cools Down".


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