Wall Street ends as Delta COVID variant sparks fears

July 16 (Reuters) – Wall Street ended lower on Friday, weighed down by declines from Amazon, Apple and other heavy tech stocks, as investors worried about an increase in coronavirus cases linked to the highly contagious Delta variant.

Los Angeles County announced on Thursday that it would re-impose its mask tenure this weekend. Public health officials said on Friday that coronavirus cases in the United States were up 70% from the previous week, with deaths up 26%. Read more

Cruise lines Carnival Corp (CCL.N) and Norwegian Cruise Line (NCLH.N) both fell about 5%.

“COVID is starting to affect the market, ironically, for the first time since last summer, when the business reopened,” said Jake Dollarhide, managing director of Longbow Asset Management in Tulsa, Oklahoma.

Amazon (AMZN.O) and Apple fell more than 1%. Nvidia (NVDA.O) lost 4.2% and all three companies contributed more than any other to the S&P 500 and Nasdaq declines. The S&P 500 tech sector index (.SPLRCT) fell nearly 1%, plunging for a second session after hitting a record Wednesday.

The utilities index (.SPLRCU) rose 1%, while the real estate index (.SPLRCR) edged up 0.1% and hit an intraday high.

This week, investors balanced concerns about a recent spike in inflation with assurances from Fed Chairman Jerome Powell that the price spike is temporary.

The second quarter earnings season resumes next week, with reports from companies including Netflix (NFLX.O), Johnson & Johnson (JNJ.N), Verizon Communications (VZ.N), AT&T (TN) and Intel ( INTC.O).

Analysts on average expect 72% earnings per share growth for companies in the S&P 500, according to IBES estimate data from Refinitiv.

With the S&P 500 up around 15% year-to-date, investors will be looking for solid business forecasts to justify sky-high valuations.

“It has been difficult for the market to take advantage of these already high prices,” said Rick Meckler, partner at Cherry Lane Investments in New Vernon, New Jersey.

The S&P 500 energy sector index fell nearly 3% and ended the week down 8% as investors worried about expectations of increased supply and an increase in coronavirus cases which have raised concerns about demand. Read more

Commerce Department data showed retail sales rebounded 0.6% last month as spending returned to services, bolstering expectations of accelerating economic growth in the second quarter. Read more

The Dow Jones Industrial Average (.DJI) fell 0.86% to end at 34,687.85 points, while the S&P 500 (.SPX) lost 0.75% to 4,327.16.

The Nasdaq Composite (.IXIC) fell 0.8% to 14,427.24.

For the week, the S&P 500 fell about 1%, the Dow Jones lost 0.5% and the Nasdaq lost 1.9%, their first weekly decline in four weeks.

Moderna Inc (MRNA.O) jumped 10.3% to an all-time high after S&P Dow Jones Indices announced that the drugmaker would join the S&P 500 Index (.SPX) as soon as trading begins on July 21 , replacing Alexion Pharmaceuticals (ALXN.O). Read more

Cintas Corp (CTAS.O) jumped 4.6% after brokerage firms raised price targets on the business services provider’s shares following its fourth quarter results.

Didi Global Inc (DIDI.N) fell 3.2% after China sent state officials from at least seven departments to the transport giant for a cybersecurity review. Read more

Falling issues outnumbered advancing ones on the NYSE by a ratio of 2.42 to 1; on the Nasdaq, a ratio of 2.21 to 1 favored the declines.

The S&P 500 posted 48 new 52-week highs and no new lows; the Nasdaq Composite recorded 46 new highs and 124 new lows.

Volume on the U.S. exchanges was 9.3 billion shares, compared to an average of 10.3 billion for the full session over the past 20 trading days.

Reporting by Devik Jain and Shreyashi Sanyal in Bengaluru; Editing by Maju Samuel and David Gregorio

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