The market opened higher on Friday, but stocks cut gains and turned negative amid fears on Wall Street over a resurgence in coronavirus cases across the country.
The Dow Jones Industrial Average was down 1.1%, nearly 300 points, by mid-afternoon on Friday, while the S&P 500 fell 0.9% and the tech-heavy Nasdaq Composite lost 0.5%.
The market initially opened higher—with the Dow up over 300 points, before stocks turned negative amid news that Apple will close some of its stores in the U.S. again.
Stocks had gotten a boost after a report from Bloomberg said that China will increase its purchases of U.S. farm goods in order to comply with the phase one trade deal. That helped ease concerns on Wall Street about U.S.-China tensions, which have flared up in recent weeks over the coronavirus.
The market has moved higher this week despite fears of a resurgence in coronavirus infections across the country: Many states reopening—such as Arizona, Texas, Florida and California—have recently seen record numbers of new cases.
Shares of companies that would benefit from the economy reopening—including airlines, retailers and cruise operators—jumped again on Friday.
Stocks initially fell on Thursday but pared back losses—with the S&P 500 turning positive—on the back of disappointing jobless claims data: Another 1.5 million Americans filed for unemployment in the week ending June 13—higher than the 1.3 million expected.
“The market thinks the glass is half full rather than half empty,” says Nicholas Sargen, economic consultant at Fort Washington Investment Advisors. Wall Street continues to be in an “optimistic frame of mind,” believing that the worst of the pandemic has passed despite a resurgence in coronavirus cases.
The market is on track to finish the week higher, which would be its fourth weekly gain in the last five weeks. Stocks have moved higher on optimism about reopening the economy, but as states continue to lift lockdowns, many experts are worried about a spike in new cases.
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