U.S. Stocks Close Mostly Lower As Trump Tests Positive For Coronavirus

(RTTNews) - Stocks fluctuated over the course of the trading session on Friday but largely maintained a negative bias. The major averages all finished the day firmly in negative territory, although the tech-heavy Nasdaq posted a particularly steep loss.

After falling by more than 400 points in early trading, the Dow briefly turned positive in mid-day trading but ended the session down 134.09 points or 0.5 percent at 27,682.81. The Nasdaq plunged 251.49 points or 2.2 percent to 11,075.02 and the S&P 500 slumped 32.36 points or 1 percent to 3,348.44.

Despite the lower close on the day, the major averages posted strong gains for the week. The Dow surged up by 1.9 percent, while the Nasdaq and the S&P 500 both jumped by 1.5 percent.

The weakness on Wall Street came following news that President Donald Trump and First Lady Melania Trump have tested positive for the coronavirus.

"Tonight, @FLOTUS and I tested positive for COVID-19. We will begin our quarantine and recovery process immediately. We will get through this TOGETHER!" Trump said in a post on Twitter early this morning.

The news comes just a month before Election Day and has led to additional uncertainty about the outcome of the presidential election.

White House physician Dr. Sean Conley said the president and first lady were "both well at this time, and they planned to remain at home within the White House during their convalescence."

Conley added that he expects Trump to "continue carrying out his duties without disruption while recovering."

A report from the Labor Department showing U.S. job growth slowed by much more than anticipated September also weighed on Wall Street.

The Labor Department said non-farm payroll employment rose by 661,000 jobs in September after spiking by an upwardly revised 1.489 million jobs in August.

Economists had expected employment to increase by 850,000 jobs compared to the jump of 1.371 million jobs originally reported for the previous month.

However, the markets attempted to recover from an initial sell-off as traders speculated Trump's diagnosis and the disappointing data could put further pressure on lawmakers to pass a new stimulus bill.

House Speaker Nancy Pelosi said in an interview with CNBC that Trump's positive test "changes the dynamic" of stimulus talks and she still believes the two sides will "find our middle ground."

Sector News

Semiconductor and software stocks saw substantial weakness on the day, contributing to the steep drop by the tech-heavy Nasdaq.

Reflecting the weakness in the sectors, the Philadelphia Semiconductor Index and the Dow Jones U.S. Software Index tumbled by 3.1 percent and 2.5 percent, respectively.

Significant weakness was also visible among biotechnology stocks, as reflected by the 2.3 percent slump by the NYSE Arca Biotechnology Index.

Retail and gold stocks also saw notable weakness on the day, while oil service stocks moved sharply higher over the course of the session.

The Philadelphia Oil Service Index surged up by 3 percent after hitting its lowest intraday level in well over four months in early trading. The rebound came despite another steep drop by the price of crude oil.

Considerable strength also emerged among banking stocks, resulting in a 2 percent jump by the KBW Bank Index. Natural Gas, commercial real estate and steel stocks also moved to the upside.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly lower on Friday, although several major markets remained closed for holidays. Japan's Nikkei 225 Index slid by 0.7 percent, while Australia's S&P/ASX 200 Index tumbled by 1.4 percent.

Meanwhile, the major European markets turned in a mixed performance on the day. While the German DAX Index fell by 0/3 percent, the French CAC 40 Index closed just above the unchanged line and the U.K.'s FTSE 100 Index rose by 0.4 percent.

In the bond market, treasuries moved modestly lower over the course of the session after seeing early strength. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, inched up by 1.9 basis points to 0.696 percent.

Looking Ahead

Following the slew of U.S. economic data released over the past week, the economic calendar for next week is relatively quiet.

Reports on service sector activity and the U.S. trade deficit may still attract some attention along with the minutes of the latest Federal Reserve meeting.

Nonetheless, next week's trading may be driven more by reaction to the latest developments regarding a new coronavirus relief bill.