Stocks fall for 8th day, longest decline since 2008 crisis
NEW YORK – Stocks retreated for an eighth consecutive day on Thursday as nervous investors remain transfixed on the potential outcome of next week’s U.S. presidential election, which has become too close to call.
The stock market is now on its longest losing streak since the depths of the 2008 financial crisis.
The Dow Jones industrial average dropped 28.97 points, or 0.2 percent, to 17,930.67. The Standard & Poor’s 500 index lost 9.28 points, or 0.4 percent, to 2,088.66 and the Nasdaq composite index fell 47.16 points, or 0.9 percent, to 5,058.41.
With five days left until the election, Hillary Clinton maintains a lead in national polling in the U.S. presidential race but Donald Trump has significantly narrowed the gap, particularly in swing states. Investors pointed to polls released in the last two days from Florida, New Hampshire and North Carolina where the two candidates are either statistically tied or Trump holds a small lead.
Investors like certainty, which means they generally favor a Clinton victory as she is seen as maintaining the status quo. Trump’s policies are less clear, and the uncertainty has caused jitters in financial markets. The last time the S&P 500 fell for eight straight days was early October 2008, the depths of the financial crisis. However the losses over this period have been modest, nowhere close to the losses racked up in 2008.
“It’s a pretty simple equation: uncertainty goes up, stock market goes down,” said David Kelly, chief global strategist with JPMorgan Funds.
The Mexican peso, which has become an indirect proxy among investors for Trump’s chances at the White House, advanced 1 percent against the dollar on Thursday. Investors have speculated that a Trump administration would be negative for the Mexican economy, and would cause the Mexican peso’s value to fall as a result.
The VIX, a measure of volatility that is called Wall Street’s “fear gauge,” jumped 16 percent this week to its highest level since June. The measure is up 36 percent this week alone.
Kelly said that Clinton is being considered a continuation of the Obama administration, which is mostly priced into the market, whereas Trump would represent a significant departure from current policies and would introduce a great deal more uncertainty into the economy. He expects the stock market to drop sharply if Trump wins.
In other parts of the market, generic drug makers plunged after news reports came out at the Department of Justice was looking to file charges, alleging price fixing, against the companies by end of year. Mylan lost $2.53, or 7 percent, to $34.14, Teva Pharmaceuticals fell $4.13, or 9.5 percent, to $39.20 and Endo International plunged $3.54, or 19.5 percent, to $14.63.
Facebook fell $7.22, or 6 percent, to $119.95. While the company reported third quarter results that easily exceeded analysts’ estimates, it also acknowledged that growth in advertising revenue was slowing.
Fitbit, the maker of wearable fitness trackers and other devices, plunged $4.30, or 34 percent, to $8.51 after the company slashed its outlook for the year, citing weak demand for its products. The company also cut its sales forecast for the holiday shopping season.
The price of crude oil extended a losing streak into a fifth day. Benchmark U.S. crude slipped 68 cents to $44.66 a barrel in New York. Brent crude, the international standard, fell 51 cents at $46.35 a barrel in London.
Heating oil fell 1 cent to $1.45 a gallon, wholesale gasoline fell 2 cents to $1.43 a gallon and natural gas fell 2 cents to $2.769 per 1,000 cubic feet.
U.S. government bond prices fell. The yield on the 10-year Treasury note rose to 1.81 percent from 1.80 percent a day earlier.
In currency trading, the dollar fell to 102.99 yen from 103.28 yen, while the euro edged up to $1.1099 from $1.1096 the day before.
In metals trading, gold fell $4.90 to $1,303.30 an ounce, silver fell 28 cents to $18.41 an ounce and copper fell 2 cents to $2.249 a pound.