Market researchers are reevaluating their early optimistic forecasts for the US stock market which continues to fluctuate in light of uncertainty over the coronavirus pandemic and business activity.
“Although the stock market was suggesting a V-shaped recovery, the more likely scenario is rolling Ws,” Liz Ann Sonders from the brokerage firm Charles Schwab, told CNBC.
The S&P 500 and the Dow indices slid by 0.5 percent and 0.8 percent, respectively, and the Nasdaq Composite remained flat on Friday after 10 American states registered record seven-day average numbers of new COVID-19 cases.
Apple on Friday also confirmed rumours that it would shut down 11 reopened locations in Arizona, Florida, North Carolina and South Carolina. All four states have seen a spike in cases after lifting coronavirus restrictions, with Florida reporting 3,207 new cases on Thursday – the state’s biggest single-day increase since the onset of the pandemic.
Volatility has persisted in the stock market despite the Federal Reserve announcing yet another measure to revitalise the economy, a programme to buy up to $250 million in corporate bonds.
Worries for a slower economic recovery than previously predicted have affected the aviation and hospitality industries. Shares in American Airlines, Delta, Carnival, Norwegian Cruise and MGM Resorts have all posted losses for two consecutive weeks after a sharp rebound in May.
“The market was priced for a continuation of improvement and I think that’s overstating what’s going to happen,” Brian Levitt, a global market strategist at Invesco, told CNBC. “We are going to have episodes of cases rising. We are going to have a very slow and uneven improvement in the jobs market.”