The major indexes fell Tuesday as traders struggled to recover from sharp losses suffered in the previous session and looked ahead to more economic data.
The Dow Jones Industrial Average lost 22 3 points, or 0.1%. The Nasdaq Composite was down 0.7%, while the S&P 500 shed 0.3%.
The major averages suffered steep losses Monday, with the Dow dropping nearly 500 points. The S&P 500 and Nasdaq each lost more than 1%, after protests in mainland China against the country’s zero-Covid policy started over the weekend. This led to worries over the potential for Chinese Covid protocols that could once again hamper global supply chains.
Overnight, however, global markets seemed to catch a reprieve as a Chinese official told reporters that 65.8% of people “over age 80” had received booster shots. On top of that, the government reported the first decline in Covid infections within mainland China in more than a week. This contributed to a rally in the Hong Kong and Shanghai markets.
“It just adds another question mark at a time where there are plenty of question marks that we have about where we’re going as far as the global economy,” said Keith Buchanan, portfolio manager at Globalt Investments, on the developments in China.
“The market just had to react to what’s coming its way, and it’s been hard to anticipate the next development,” he added. “There’s nothing less predictable than a pathogen.”
Within the US, investors will watch for data coming later this week on topics such as gross domestic product and jobs for insight into how the economy is responding to inflation.
Fed Chair Jerome Powell is scheduled to speak at the Hutchins Center on Fiscal and Monetary Policy at Brookings on Wednesday. Investors will be listening for clues into whether the central bank will slow or stop interest rate hikes.