Even if you don’t trade in the stock market, it can be a good barometer for the health of the American economy. Today, investors on Wall St. were worried about the spike in Covid cases and The Dow Jones suffered its biggest drop of the year. The Wall Street Journal reports:
The moves were reminiscent of trading patterns that prevailed in the early days of the pandemic. Investors sold shares of companies directly affected by restrictions on movement and business, while buying government bonds and stocks that stood to benefit from renewed lockdowns.
— CNBC Now (@CNBCnow) July 19, 2021
Travel stocks were hit particularly hard as investors worried the rise in cases would again impact travel. CNBC writes (watch above):
Shares that are directly tied to a successful reopening such as airlines and cruise line operators bore the brunt of the sell-off. Carnival and Norwegian Cruise Line dropped more than 5% each, while Royal Caribbean fell over 4%. The trio have all tumbled at least 30% from their 52-week highs.
COVID wasn’t the only reason for market jitters. Inflation, troubles with China, and a slowing in economic growth were also said to be factors for the decline.