The United States Stock Exchange ended a volatile week with the three main indexes ending varied on Friday (11/09/2020). Based on Bloomberg data, the S&P 500 index closed up 0.05 percent at 3,340.97. On the other hand, the Dow Jones Industrial Average rose 0.48 percent.
The Nasdaq Composite index ended down 0.6 percent or 66.05 points to the level of 10,853.55. So far this week, the Dow Jones is down 1.66 percent, the S&P is down 2.51 percent, and the Nasdaq is weakened 4.06 percent.
This decline occurred due to several conditions. An example is the Coronavirus pandemic which has not ended until the economic situation of the United States. This situation was compounded by the political conditions there which had been heating up for some time.
Technology Sector as the Driver of Fluctuation
The technology sector index was the main driver of market fluctuation this week. This sector recorded its fifth decline in six days and the biggest weekly percentage decline since March. Because of this, some investors decide to sell their shares.
Investors are selling shares of companies like Apple Inc which have spearheaded dramatic rallies from lows due to the coronavirus pandemic in March. Apple also shares fell up to 1.31 percent on Friday and fell 16 percent from a 10-day high.
Cornerstone Capital Group CEO Erika Karp said this kind of volatility occurs when there is a lack of information for investors. They don't have enough data and information. According to him, having good economic data can be a driver for economic improvement and the stock market.
Markets can adapt when there is a certainty to get every day. However, when there is extreme uncertainty, and when we are in a transition period, volatility will happen. The opinions made by these experts and analysts certainly make a lot of sense.
Conditions and Data for some United States Shares
Most shares of the S&P 500 index are reported to have risen. Meanwhile, the Dow Jones Industrial Average rose on rallies at Nike, Dow, and Caterpillar. The Russell 2000 index of small-cap companies fell 0.7 percent. This is the data that came from the market.
The tech sector index weakened as investors assessed whether the pullback had worked its own way. Sales of the sector's shares increased on Friday after Bloomberg reported that SoftBank Group Corp. was considering a controversial revamp and using derivatives to invest in technology companies.
Meanwhile, Microsoft stocks took a hit after reports that China was not supporting the forced sale of TikTok businesses in the US. Global bourses also recorded their first consecutive weekly decline since March, after experiencing a rally that raised the US stock market capitalization.
The pandemic continues to exert pressure on the global economy in the world. It happened with US data showing the power market has yet to recover. However, the rebound in US futures showed some investors viewed the decline as a temporary correction.
Investors Hold an Important Role
UBS Global Wealth Management's managing director and personal asset advisor, Charles Day, said investors should keep investing. It must be continued even though it takes the right strategy. He also maintains his positive outlook on the stock market.
When any of these sudden and short-term movements occur, it doesn't mean investors should avoid the sector. However, they must be prepared that a guarantee or price is needed to enter there. This opinion was quoted as saying by Bloomberg.
On the other hand, the European Stock Exchange recorded quite good gains in the trading market. European stocks have been stuck in a narrow range since mid-June. The rise in the euro has put pressure on the stock's relative performance against global stocks.
