Wall Street follows financial stocks in the red – Nike under pressure

The New York Stock Exchange on Wall Street

The New York Stock Exchange is based on the famous street.

(Photo: dpa)

new York The US stock markets eased on Friday, as a result of price losses in financial stocks. Investors were also nervous about the renewed tensions with China. The standard value index Dow Jones closed 2.8 percent lower at 25,015 points. The technology-heavy Nasdaq dropped 2.6 percent to 9757 points. The broad S&P 500 lost 2.4 percent to 3009 points. In the dispute over Hong Kong’s autonomy, the US imposed visa restrictions on certain members of the Chinese Communist Party.

Bank of America, Citigroup and JPMorgan shares lost between five and six percent after the US Federal Reserve temporarily banned dividends and share buybacks from the institutions due to the coronavirus pandemic. The aim is to strengthen the capital base of the financial institutions in order to better survive the consequences of the crisis. “The banks passed the Fed stress test, but as we all know, it was only thanks to the central bank’s money injections and government stimulus,” said Neil Wilson, chief analyst at online broker Markets.com.

Opinions differed as to the further direction of the stock market, said Christopher Grisanti, chief investment strategist at the asset manager MAI. “There is a tug of war between those who believe that the economic recovery is unstoppable and those who fear new problems. It’s more likely that the outlook is not as bright as the market thinks. ”

Investors were also concerned about the record number of infections in the United States. “The United States is rethinking its easing of the pandemic restrictions,” said analyst David Yepez from Exencial, an investment advisor. That would affect the economy in the respective region. A fall in share prices to the lows of March is not expected. However, a correction must be expected since the prices have risen too quickly since then. Wall Street gained around 40 percent within three months.

Look at the individual values

Nike was one of the losers in the US stock market with a price drop of almost eight percent. Forced shutdowns as part of the pandemic control broke a surprising quarterly loss for the sporting goods manufacturer. The profit margins and high inventories are also disappointing, criticized analyst James Grzinic from investment bank Jefferies. That is not a good omen for the business of German competitors Adidas and Puma. US rival Under Armor’s titles fell more than five percent.

Gap, on the other hand, posted a price jump. The shares of the clothing company rose by almost 19 percent. The company is launching a joint fashion line with rapper Kanye West’s Yeezy label. Financial details were not given. Yeezy is said to receive royalties and possibly gap shares.

The shares of Facebook were among the losers with a minus of over eight percent. More and more corporations want to stop advertisements on Facebook and thus use the online platform to take a stronger action against racist and violence-glorifying content. The American mobile operator Verizon announced that the pause will continue until Facebook offers an acceptable solution. Consumer goods company Unilever also announced it would suspend its advertising on Facebook, Instagram and Twitter for the rest of the year. Twitter’s shares slumped more than seven percent.

More: Wall Street stocks promise more growth. Read the full comment here.

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