(Bloomberg) — U.S. stocks fell in thin trading a day after notching another all-time high in the final days of the year. Treasuries ticked higher.
The S&P 500 slipped to session lows in the few minutes of trading Thursday, a day after posting its 70th record close of the year Wednesday. The tech-heavy Nasdaq 100 also pushed lower, along with the Dow Jones Industrial Average.
Cruise line stocks including Carnival Corp. and Royal Caribbean Cruises Ltd. erased gains, though were off session lows, after the Centers for Disease Control and Prevention said cruise ships should be avoided even if passengers are vaccinated due to the risk of Covid-19.
The 10-year Treasury yield dropped back below its 50-day moving average, with long-end rates dropping the most. A dollar gauge was little changed.
In an illustration of still-solid labor demand despite the latest coronavirus wave, data Thursday showed jobless claims unexpectedly fell last week while continuing claims dropped to the lowest level since March of last year. A measure of Chicago business activity rose in December more than economists predicted.
“Usually we get the Santa Claus rally but then these last couple of days can be pretty volatile,” Chris Gaffney, president of world markets at TIAA Bank, said in an interview. Managers can decide to lock in gains, but “we’re not seeing that this year,” he said. “The economic environment, fundamentals for companies are still very strong.”
The number of Covid-19 cases soared 32% to a record 1.73 million on Wednesday, marking the third day in a row with more than a million new infections worldwide. Still, more evidence is emerging that omicron may be less dangerous, particularly in vaccinated people, as virus deaths in the U.S. declined.
As the year draws to a close, investors are assessing the implications of the fast-spreading omicron coronavirus variant, elevated inflation caused by supply bottlenecks and removal of stimulus measures, including monetary policy tightening, notably by the Federal Reserve.
“At the year-end, there’s nothing dramatically changing in terms of new information on macro changes,” said Colin Stewart, head of Americas at Quant Insight. “Into January, what we’re seeing now on the S&P is that the S&P is actually quite comfortable with rises in the Fed rate expectations. In fact, that’s the number one positive driver on this short-term S&P.”
Corporate highlights:
- Biogen Inc. fell after Samsung Group denied a Korean media report that the U.S. drugmaker was in talks to sell itself to the company.
- The Food and Drug Administration is planning to allow 12- to 15-year-olds to receive a third dose of Pfizer-BioNTech’s vaccine, The New York Times reported, citing people familiar with the agency’s plans.
- Luxury real estate brokerage Douglas Elliman Inc. rose as it began trading as a public company Thursday in a spinoff from Vector Group Ltd.
- R.R. Donnelley & Sons Co. gained after the printing and information services company said it received a non-binding offer.
For more market analysis, read our MLIV blog.
Some of the main moves in markets:
Stocks
- The S&P 500 fell 0.2% as of 3:50 p.m. New York time
- The Nasdaq 100 fell 0.3%
- The Dow Jones Industrial Average fell 0.2%
- The MSCI World index was little changed
Currencies
- The Bloomberg Dollar Spot Index was little changed
- The euro fell 0.2% to $1.1322
- The British pound was little changed at $1.3500
- The Japanese yen fell 0.1% to 115.07 per dollar
Bonds
- The yield on 10-year Treasuries declined four basis points to 1.51%
- Germany’s 10-year yield was little changed at -0.18%
- Britain’s 10-year yield declined four basis points to 0.98%
Commodities
- West Texas Intermediate crude was little changed
- Gold futures rose 0.7% to $1,817.90 an ounce
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