The Journal Gazette
Friday, May 22, 2020 1:00 am

Stocks slide as data reveals damage

Investors seeing 'weakness' ahead of Memorial Day

ALEX VEIGA and DAMIAN J. TROISE | Associated Press

Stocks closed broadly lower on Wall Street on Thursday as investors weighed more data showing the economic damage being caused by the coronavirus pandemic and another flareup in tensions between the U.S. and China.

The S&P 500 fell 0.8%, shedding some of the gains it made a day earlier. Bond yields were mixed. Oil prices closed higher, extending a string of gains.

Technology and health care stocks took some of the heaviest losses. Only industrial sector stocks eked out a gain. Homebuilders, meanwhile, moved higher, extending the group's rally.

“It really looks like a little bit of weakness ahead of the long holiday weekend,” said Ryan Detrick, senior market strategist for LPL Financial. U.S. markets will be closed Monday for Memorial Day.

Thursday's selling was tentative at first, but gained momentum as the day progressed. Initially, traders reacted to news that the White House had issued a report attacking China's economic and military policies, and its human rights violations. The report expands on President Donald Trump's get-tough rhetoric that he hopes will resonate with voters angry about China's handling of the disease outbreak.

Meanwhile, the State Department announced that it had approved the sale of advanced torpedoes to the Taiwanese military, a move sure to draw a rebuke from Beijing, which regards the island as a renegade province.

The government's latest weekly snapshot of applications for unemployment aid didn't help. The Labor Department said more than 2.4 million people applied for U.S. unemployment benefits last week. All told, the running total of Americans who have lost their jobs in the two months since the coronavirus led to a near shutdown of the economy has climbed to 38.6 million.

Despite a week of uneven finishes, Wall Street is on track to recoup its losses from last week amid fresh hopes for a U.S. economic recovery in the second half of the year and optimism about a potential vaccine for COVID-19. A strong rally on Monday reversed all of the market's losses for the month. The index is still down about 13% from its high in February.

At a glance

• The S&P 500 slid 23.10 points to 2,948.51.

• The Dow Jones Industrial Average fell 101.78 points, or 0.4%, to 24,474.12.

• The Nasdaq composite lost 90.90 points, or 1%, to 9,284.88.

• The Russell 2000 index of small-company stocks inched up 0.63 points, less than 0.1%, to 1,347.56.

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