Stocks were under pressure in Thursday afternoon trading after showing a lot of sluggish performance in the morning. All major averages receded sharply, offsetting the strong rise posted in the previous session.
The main average was below the worst level, but still closed tightly in the negative territory. The Dow fell 321.41 points (0.9%) to 33,815.90, the Nasdaq fell 131.81 points (0.9%) to 13,818.41, and the S & P 500 fell 38.44 points (0.9%) to 4,134.98.
The afternoon sale followed President Joe Biden’s plan to almost double the capital gains tax rate on wealthy individuals to fund childcare and education spending. ..
According to media outlets such as Bloomberg News and The New York Times, Biden’s so-called “American Family Plan” will raise capital gains from 20 percent to 39.6 percent for those who earn more than $ 1 million.
The report shows that the Biden administration’s tax system market Throughout the past year.
Earlier that day, traders unexpectedly responded to the Ministry of Labor’s report showing a continued decline in claims during the first unemployment of the week ending April 17.
Initial unemployment claims fell to 547,000, down 39,000 from last week’s revised level of 586,000, according to the report.
The continued decline was a surprise to economists who expected unemployed claims to recover from 576,000, which was first reported last month, to 617,000.
Due to an unexpected decline, unemployed billing has fallen to its lowest level since reaching 256,000 in the week ending March 14, 2020.
Meanwhile, the National Association of Real Estate Agents released a report in March showing that existing home sales in the United States fell further.
According to the NAR, existing home sales fell 6.3% in February to 6.24 million, and then fell 3.7% to 6.01 million annually in March.
Economists expected existing home sales to fall 0.5% to 6.19 million, down from 6.22 million initially reported last month.
Semiconductor stocks fell sharply after showing the best performance in the market in the previous session, dropping the Philadelphia Semiconductor Index by 2.3%.
Gold stocks also showed significant weakness, as reflected in the 2.1% decline from the NYSE Arca Gold Bugs Index.
Weakness in the gold sector arose amid falling prices for precious metals, with gold delivered in June falling from $ 11.10 to $ 1,782 per ounce.
The report of capital gains also put pressure on brokerage stocks, causing the NYSE Arca Broker / Dealer Index to fall 1.7%.
Chemical, oil and banking stocks also showed noticeable weaknesses that day, declining along with most other major sectors.
In foreign trading, the Asia-Pacific stock market almost rose during Thursday’s trading. Japan’s Nikkei 225 index rose 2.4% and Hong Kong’s Hang Seng index rose 0.5%.
On that day, major European markets also started to rise. The UK’s FTSE 100 index rose 0.6%, while the German DAX index and the French CAC 40 index rose 0.8% and 0.9%, respectively.
In the bond market, government bonds fluctuated during the session and closed at slightly higher prices. Since then, the yield on benchmark 10-year bonds, which move in the opposite direction of price, has fallen by one basis point to 1.554%.
Revenue news is likely to focus on Friday, and semiconductor giant Intel (INTC) has released quarterly results after today’s closing.
American Express (AXP) and Honeywell (HON) will also report results before the opening of trading on Friday.
Revenue news could obscure the Commerce Department’s report on new home sales in March.
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US stocks plunge following reports of capital gains tax hikes
Source link US stocks plunge following reports of capital gains tax hikes