Major U.S. stock indexes fell from record levels on Monday as investors sought cues from first-quarter earnings reports to justify the rich valuation of equities.
Tesla was the biggest drag on the S&P 500 and the Nasdaq, with the electric-car maker down three per cent after a Tesla vehicle, which was believed to be operating without anyone in the driver’s seat, crashed into a tree on Saturday night north of Houston, killing two occupants.
Coca-Cola Co rose one per cent after the beverage maker trounced estimates for quarterly profit and revenue, benefiting from the easing of pandemic curbs and wide vaccine rollouts.
IBM Corp, another blue-chip company, slipped about 0.2 per cent ahead of its results after market close.
“The market has had a huge jump to the upside so it needs to take a little bit of rest,” said Peter Cardillo, chief market economist at Spartan Capital Securities in New York.
“For now it’s just a little bit of profit taking as traders await results from big tech names on Wall Street.”
Meanwhile London’s FTSE 100 closed 0.28 per cent down this afternoon after a negative turn this morning, managing just to keep its head above the 7,000-mark.
The FTSE 250 closed down a more moderate 0.14 per cent.
The FTSE 100 rose above the 7,000-mark last week for the first time since the pandemic pummelled financial markets last year.
The pound soared to a two-week high against the dollar, pushing through $1.39, a positive turn of the tides in the UK economy’s rebound from the deepest recession in three centuries.
“Current domestic Covid-19 data is encouraging and a further easing of lockdowns will all point in the direction of the UK economy early out of the block on economic recovery expectations,” head of FX sales at Mizuho Bank, Neil Jones, said.
Winners and losers
Middles-class favourite Ocado is the day’s biggest winner so far, up 3.26 per cent to 2,252p a share.
Miner Fresnillo, engine maker Rolls Royce and British Airways owner IAG are each up by around 1.9 per cent as well
Johnson Matthey continued to rise, up 1.38 per cent to 3,230p, after it signed an agreement with Russian metals producer Nornickel to produce electric vehicle batteries.
The biggest fallers on the FTSE 100 were Melrose Industries, Pheonix Group and Smith & Nephew, both down between 1.4 and two per cent, respectively.
Oil prices dipped lower this morning, as surging Covid-19 cases in India and other countries stoked concerns that stricter measures to contain the pandemic would be a blow to economic activity, as well as the demand for crude.
Brent crude was down 0.15 per cent, at $66.67 a barrel, after rising 6 per cent last week.
US oil was down 0.2 per cent this morning, at $62.96 a barrel, backtracking on last week’s gains of 6.4 per cent.