The market finished lower on Tuesday as Big Tech stocks posted declines which offset an initial rally sparked by Russia’s claims that it approved the world’s first coronavirus vaccine.
The Dow Jones Industrial Average was down 0.4%, around 100 points, on Tuesday, while the S&P 500 fell 0.8% and the tech-heavy Nasdaq Composite lost 1.7%.
Although stocks moved higher for most of the day—with the Dow at one point rising over 350 points, all three major indexes turned negative in the final hour of trading.
Investors continued to rotate out of Big Tech stocks, dragging the market lower: Shares of Amazon, Microsoft, Apple, and Netflix all fell between 1% and 2%.
Stocks initially rose following Russian President Vladimir Putin’s overnight announcement that his country was the first to grant regulatory approval for a coronavirus vaccine, after less than two months of human testing.
While Russia’s rapid approval of the vaccine has met with skepticism and raised concern among medical experts, the news did spark optimism among investors that a vaccine could be available in the U.S. sooner than expected.
Shares of companies that would benefit from a vaccine and a reopening of the economy—including airlines, cruise stocks and retailers—jumped on the news Tuesday.
“Although the timing is uncertain, the stock market is expressing confidence that the pandemic will end eventually with a vaccine—or multiple vaccines—and with help from better treatments in the interim,” says Jeff Buchbinder, equity strategist for LPL Financial.
WHAT TO WATCH FOR
Ongoing coronavirus stimulus talks, which ended in a stalemate last week. President Trump on Saturday issued several executive orders to extend economic relief programs, such as expanding federal unemployment benefits—at a reduced rate of $400 per week, deferring student loan payments through 2020, extending a federal moratorium on evictions and providing a payroll tax holiday. But Trump’s executive action was met with criticism from both parties and is likely to face legal challenges, since continuing the programs would require federal funding from Congress. Treasury Secretary Steven Mnuchin said on Monday that the White House is open to resuming coronavirus relief talks with Democrats and is willing to provide more relief money in order to make a compromise.
After nine straight weeks of gains, the price of Silver plunged 14% on Tuesday, its biggest one-day loss since 2008. Gold also fell 5.5%, hitting its lowest level since last month.
So far, 448 companies in the S&P 500 have reported second-quarter earnings, with nearly 82% beating Wall Street expectations—the highest rate on record dating back to 1994, according to Refinitiv data. Just over 16% of companies so far have failed to meet expectations.
–Sergei Klebnikov, Forbes Staff