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Tuesday, October 20, 2020

American stocks drop in wake of President’s COVID-19 diagnosis

American stocks are selling in the wake of President Trump, and members of his family and a key staff member, testing positive for COVID-19.

The news, which came overnight, is weighing heavily on all major American indices, but heaviest on tech shares. As of the time of writing, here’s where the mess stands:

  • Dow Jones Industrial Average: Futures off 1.5%
  • S& 500: Futures off 1.63%
  • Nasdaq Composite: Futures off 2.32%

Smaller, and more specific baskets of equities like the Bessemer cloud index do not release similar pre-market numbers, so we cannot see the precise impact that the news, and the potential political destabilization that it may bring, are having on the shares of the tech industry that have flown the highest.

But we can see around the edges: Datadog is off 2.9%. Salesforce is off 1.8%. Zoom is off 1.7%. Crowdstrike is off 3.2%, and so forth. In short, it doesn’t appear that SaaS and cloud stocks are faring better than tech stocks more broadly.

Recent direct listings Palantir and Aasana are off 3.8% and 3.4%, respectively, in pre-market trading. Other recent IPOs are down as well, including JFrog (off 5.8% before the bell), and Snowflake (off 4.6% in pre-market trading).

It’s not hard to guess why the stock market is suffering in the wake of the President’s diagnosis. This close to an already volatile election, complicating factors are deleterious to investor confidence. That’s bad for stocks. And it would be a good moment to have a fully healthy President to help get another round of stimulus done. That package could be undercut by today’s chaos. And on and on.

TechCrunch will keep an eye on the markets as the day continues, but don’t expect your personal accounts to look better at the day’s end than the beginning.

This post courtesy of techcrunch

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