Bouncing back: Wall Street recovers after worst day since October

Wall Street showed signs of recovery early Tuesday, after the Dow Jones Industrial Average worst day since last October.

As of just before 11:00 a.m. EST Tuesday, the Dow rose 1.6 percent, the S&P 500 index was up 1.3 percent, and the Nasdaq composite was up 1 percent. On Monday the S&P 500 fell 1.6 percent, its biggest single-day drop since May. And, the Dow fell by more than 700 points, its biggest single day drop since October.

The spread of the more contagious Delta variant of COVID-19 has become a worry spot for investors and policymakers.

Bond yields fell sharply on fears the pandemic economic recovery could be put at risk from additional lockdowns or rise in coronavirus cases. The yield on the 10-year Treasury note rose to 1.2 percent from 1.18 percent the day before. Barely a week ago, the 10-year note was trading at a yield of 1.33 percent.

Airlines and other companies that would get hurt by potential new COVID-19 restrictions took some of the heaviest losses Monday. United Airlines lost 5.5%, mall owner Simon Property Group gave up 5.9%, and cruise operator Carnival fell 5.7%. Those losses are similar to the early days of the pandemic last February and March 2020.

However, Monday’s selling pressure was widespread, affecting nearly 90 percent of the stocks in the S&P 500. Even Big Tech stocks fell, with Apple down 2.7 percent, and Microsoft down 1.3 percent.

While tens of millions of Americans have gotten vaccinated, there remains a significant percentage of Americans who are either reluctant or outright hostile to the idea of getting vaccinated. Last week, Los Angeles Country reinstituted an indoor mask mandate as the region’s infection rate climbed quickly. Other parts of the country, like Southern Missouri, are flooded with COVID cases putting a strain on hospitals.