With only a few days left until the end of the trading year, investors continued to sell tech stocks, sending the Nasdaq to more than two-month lows on Wednesday. The Nasdaq dropped 1.1% to reach its lowest point since October 13th.
The Dow Jones Industrial Average lost 216 points or 0.7% and the S&P 500 dropped by 0.8%. The S&P 500 is expected to have its worst annual loss since the 2008 financial crisis.
Apple led the selling in the technology sector, plunging more than 2%. There are ongoing concerns about an iPhone supply deficit and a manpower shortage at Foxconn’s primary production site in Zhengzhou, China. Tesla traded merely 2% higher following the exhaustion of its recovery from a recent 52-week low.
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Industrials also took a hit. Airline equities weakened after a wave of cancellations following a major winter storm that has halted travel in several areas of the US. Following a warning that it would keep cancelling flights until it could resume regular operations, Southwest Airlines saw a 3% decline. More than 1% was lost by AAL and DAL.
Due to increasing interest rates and the worry of a US recession, equities are on a firmer path to end the year in the red. Wall Street suffered a decline, despite reduced trading volumes.
Dollar picks up as traders move towards risk
The Canadian dollar (CAD) is under pressure due to an inflated American dollar. USD/CAD trades at about 1.3600. The US dollar Index (DXY), a measure of the value of the dollar relative to a group of competing currencies, rises 0.18% to 104.454. Higher US treasury bond rates also helped the greenback. The benchmark 10-year note rate rises three and a half basis points to 3.879%.
While GBP/USD is trading at 1.2025, the EUR/USD pair is still trading around 1.0600, down for the day. Finally, the USD/JPY pushes through its 134.30 area weekly highs.
Oil falls below a crucial point
Oil prices fell on Wednesday as traders weighed the likelihood of loosening pandemic restrictions in China.
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The Russian decision to reduce oil exports to nations who uphold the price ceiling was disassociated by OPEC+. Although intraday losses were cut before the close, crude oil slipped lower. The price of Brent oil futures dropped $1.07, or 1.3%, to end at $83.26 a barrel, while the price of US West Texas Intermediate crude futures dropped 57 cents, or 0.7%, to settle at $78.96 per barrel.