Dow plummets 726 points for worst day of 2021 as virus variants threaten global recovery

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Dow plummets 726 points for worst day of 2021 as virus variants threaten global recovery
Spencer Platt/Getty Images
  • US stocks fell sharply Monday as investors grew concerned about the global spike in COVID-19 cases.
  • The 10-year Treasury note declined as much as 12.2 basis points to 1.177%.
  • Cryptocurrencies, gold, and oil were all lower. Lumber prices rose.

US stocks cratered on Monday as investors eyed a spike in global COVID-19 cases led by the Delta variant, which threw up a roadblock to a full recovery of the economy.

The Dow Jones Industrial Average fell 726 points, or about 2.1%, for its worst day since October, while the benchmark S&P 500 and the tech-heavy Nasdaq composite also tumbled.

The yield on the 10-year Treasury note declined as much as 12.2 basis points to 1.177%, its lowest level since February, as investors flocked to safe-haven assets.

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Here's where US indexes stood at the 4:00 p.m. ET close on Monday:

Read more: 'More weakening beneath the surface': A Wall Street strategist who warned investors before last year's 35% crash lays out the latest signs that another slump into a bear market is looming

"COVID has returned to the front burner of investor concerns right now," David Donabedian, the chief investment officer of CIBC Private Wealth, said in a note. "Last week we had high inflation readings. Now we have concerns that the rise in COVID cases is dimming the economic outlook. While the second-quarter earnings reports have so far beat expectations, this is old news now."

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Shares of airlines, cruise operators, and other travel companies slumped on concerns that the Delta variant would derail the recovery.

American Airlines and the airplane maker Boeing all slipped roughly 5% each. Expedia Group and the hotel chain Marriott both declined by roughly 3% each. Meanwhile, Carnival, Norwegian Cruise Line Holdings, and Royal Caribbean Cruises all fell as well.

Energy stocks tumbled, including the Texas oil-equipment maker NOV and Diamondback Energy.

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Some said the plunge on Monday was nothing to fear. The sell-off in stocks is a "healthy pullback" that will likely be short-lived and could present a buying opportunity, Katie Stockton, a technical analyst at Fairlead Strategies, said.

In cryptocurrencies, bitcoin continued its recent slide, falling as much as 3.4% to $30,646.90. All other major cryptocurrencies - ether, cardano, ripple, dogecoin, polkadot, and solana - traded lower on Monday.

Despite the downturn, mining bitcoin has been a lot easier. The asset's "network difficulty," which measures how much computing power is needed to mint a new bitcoin, has plummeted.

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Oil fell on news over the weekend that OPEC+ reached a deal on supply to overcome the deadlock between Saudi Arabia and the United Arab Emirates.

West Texas Intermediate crude fell as much as 8.06% to $66.02 a barrel. Brent crude, oil's international benchmark, dropped 7.39% to $68.15 a barrel at intraday lows.

Gold fell as much as 0.45% to $1,807.56 an ounce.

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Lumber gained modestly, rising 4.83% to $561.90 as supply was catching up with demand. Prices are set to stay elevated despite recent declines, a Fastmarkets economist said.

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