The S&P 500 and Dow have dropped as investors worried about another round of business shutdowns to contain a surge in coronavirus cases and began to shift their focus to earnings, while the Nasdaq hit another record closing high.
The United States recorded more than 60,000 new COVID-19 infections on Wednesday, setting a single-day global record while Florida and Texas reported a record one-day increase in deaths.
Investors also began to turn their focus to the second-quarter earnings season, which shifts into higher gear next week.
S&P 500 companies are expected to post a more than 40 per cent decline in year-over-year earnings, which would be the biggest quarterly profit drop since the 2008 financial crisis, based on IBES data from Refinitiv.
Walgreens Boots Alliance Inc shares dropped after it reported a quarterly loss compared with a profit a year earlier, hurt by non-cash impairment charges of $US2 billion ($A2.9 billion) as COVID-19 disrupted business at its Boots UK division.
Its stock closed 7.8 per cent lower.
“We’re heading into earnings season, and you’re seeing some troubling trends,” said Peter Tuz, president of Chase Investment Counsel in Charlottesville, Virginia.
“I expect a lot of confusing numbers and guidance. COVID is certainly not behind us in any way, shape or form, so maybe the V gets elongated some,” he said.
The Nasdaq registered its fifth record closing high in six days, helped by gains in Amazon.com, Microsoft Corp , Nvidia, Apple Inc.
Also, Tesla extended recent gains, ending up 2.1 per cent.
The Dow Jones Industrial Average fell 361.19 points, or 1.39 per cent, to 25,706.09, the S&P 500 lost 17.89 points, or 0.56 per cent, to 3,152.05 and the Nasdaq Composite added 55.25 points, or 0.53 per cent, to 10,547.75.
The benchmark S&P 500 is still up more than 40 per cent from its March 23 closing low.
Helping stocks early in the day was data showing the number of people in the US filing for jobless benefits dropped to a near four-month low last week.
A record 32.9 million people though were collecting unemployment cheques in the third week of June.
A batch of upbeat economic data including the record pace of job additions in June has underscored that the stimulus-fuelled domestic economy was on the path to recovery.
In a bullish signal for near-term momentum, the benchmark S&P 500’s chart formed a “golden cross” pattern, in which its 50-day moving average vaulted above the 200-day moving average.
Declining issues outnumbered advancing ones on the NYSE by a 2.56-to-1 ratio; on Nasdaq, a 2.19-to-1 ratio favoured decliners.
The S&P 500 posted 33 new 52-week highs and one new low; the Nasdaq Composite recorded 117 new highs and 33 new lows.
Volume on US exchanges was 10.73 billion shares compared with the 12.23 billion average for the full session over the last 20 trading days.