US stocks fall hard as COVID-19 rates surge

4:05pm: US equities close sharply lower on rising COVID-19 rates US stocks fell sharply on rising coronavirus (COVID-19) infections and the pandemic’s impact on the global economy -- as well as Washington’s failure to approve a fiscal stimulus package.  On the day, the Dow Jones Industrial Average dropped 942 points, or 3.43%, to 26,521, its worst day since June. The S&P 500 declined 3.53% to 3,271 and the tech-heavy Nasdaq fell 3.73% to 11,004.  12:30 pm: Wall Street's swoon continues The Dow was down nearly 700 points, 2.5%, with the election less than a week away. The Nasdaq Composite dropped 324 points, 2.8%, to 11,109.6, and the S&P 500 fell 84 points, 2.5%, to 3,306.1 "The non-existent chances of a stimulus package pre-election have combined with the tightening of some election polls to bring fears of a political deadlock both in selecting the new president and any big rescue package post-November 4," IG analyst Chris Beauchamp wrote Tuesday. "The market narrative has gone from ‘Biden is going to win and win big’ to ‘a contested election and a lack of stimulus’ is a much higher probability." Coronavirus cases in the US have risen by an average of 71,832 over the past week, a record, according to data from Johns Hopkins University, per CNBC. “I think there’s going to be a call for lockdowns the likes of which we’ve seen in Chicago,” CNBC’s Jim Cramer said Wednesday. “The lockdowns without the stimulus equals what we’re seeing. It’s a shame because, had there been stimulus, we’d then be focusing on earnings and the earnings are actually pretty darn good.” Travel companies are among the hardest hit. Delta Air Lines Inc (NYSE:DAL) was down 3.4% to $29.66, Southwest Airlines Co (NYSE:LUV), slipped 3.5% to $38.55 and Royal Caribbean Group (NYSE:RCL) tumbled 3.7% to $55.28. 9:43 am: US markets brace for enough rough day Despite expectations of a mixed open, the main Wall Street indices all saw steep declines at the opening bell as the US markets followed the lead from Europe’s selloff. In the first minutes of trading, the Dow Jones Industrial Average dropped 1.98% to 26,919 while the S&P 500 sank 1.9% to 3,325 and the Nasdaq slumped 1.9% to 11,213. Market sentiment appears to have turned firmly negative amid rising cases of coronavirus and what many now see as the inevitability of new lockdown measures across multiple countries heading into the winter period. The outlook among traders may also have taken a knock from results from aircraft maker Boeing, which reported yet another quarterly loss and unveiled plans to axe around 7,000 jobs by the end of next year as the pandemic grounded most of the world’s airlines and, by extension, caused orders for its planes to dry up. Wall Street expected to start mostly lower US stocks are set to follow Europe’s lead and head south today, although not for the first time tech stocks are a law unto themselves. Spread betting quotes point to the Dow Jones Industrial Average slumping 488 points to 26,976 and the S&P 500 plunging 48 points to 3,343 but the tech-heavy NASDAQ Composite is seen rising 46 points to 11,477. “Mainland European markets are once again at the forefront of a collapse in equity valuations, with a second bout of nationwide lockdowns raising the chance of a double-dip recession. While regional action helped alleviate much of the negative market impact in recent months, the sharp ascent in Covid cases throughout Europe clearly calls for more dramatic measures. With the DAX slumping into a fresh four-month low, we look to be on our way to finally see the second major collapse in equity prices since the March bottom,” said IG’s Joshua Mahony. This morning has seen industrial holding company General Electric Co (NYSE:GE) surprise the market with positive third-quarter earnings per share (after adjusting for one-off items) of 6 cents, down from 15 cents in the same quarter of last year. Analysts who follow the old warhorse had expected a loss per share of around 4 cents. “Today’s key US economic releases are the advance goods trade and distribution sector inventory reports for September, which will allow analysts to further tinker their estimates of growth ahead of Thursday’s preliminary Q3 GDP report,” according to Daiwa Capital Markets. “As far as the trade report is concerned, we expect the goods deficit to have narrowed by US$2.1bn to US$81.0bn in September, with exports likely growing for a fourth consecutive month – but remaining well below pre-pandemic levels – and imports perhaps pausing after reaching a 7-month high in August,” Daiwa said. Five things to watch for on Wednesday: As earnings season rolls on, firms likely to catch the eye of investors include payment giants Visa Inc (NYSE:V) and Mastercard Inc (NYSE:MA) Also in focus will be aircraft manufacturer Boeing Inc (NYSE:BA), which most attention likely to be paid to how the collapse in air travel during the pandemic has impacted its order book and bottom line Meanwhile, delivery group United Parcel Service Inc (NYSE:UPS) will be eyed for share price reaction after both its profits and revenues topped expectations in its latest figures The political arena will also offer something for investors to consider as the CEO’s of Facebook Inc (NASDAQ:FB), Twitter Inc (NYSE:TWTR) and Google parent Alphabet Inc (NASDAQ:GOOG) appear before the US Congress to address section 230 of the Communications Decency Act, a law that underpins US internet regulation and exempts platforms from legal liability for content generated by users On the macro calendar, the US is due to report its trade balance in goods for the month of September, with forecasts expecting the trade deficit to narrow slightly to US$80 billion from US$83.11 billion in August