U.S. stocks declined on Thursday, as consumer staples posted heavy losses amid corporate earnings season. Meanwhile, a broad recovery in altcoins led the digital currency market sharply higher.
Stocks Decline
All of Wall Street’s major indexes headed for losses, with the S&P 500 Index falling 0.6% to 2,693.13. Nine of 11 sectors contributed to the decline, with the consumer staples component plunging 3.1%.
Within the sector, tobacco plunged 11.5% after Philip Morris International Inc. (PM) posted first-quarter revenue that trailed forecasts.
Information technology shares also fell 1.1%, with Apple among the worst-performing companies in the sector.
The technology-driven Nasdaq Composite Index closed down 0.8% at 7,238.06. The Dow Jones Industrial Average also fell 83.18 points, or 0.3%, to finish at 24,664.89.
A measure of 30-day volatility known as the CBOE VIX reached a high of 16.92, which was still well below the historic average. The so-called “fear index” settled at 15.96 for a gain of only 2.3%.
If after-hours trading is any indication, volatility could be on the rise on Friday. Several shares plunged after the bell following disappointing corporate earnings.
Sketchers (SKX) fell 23%, Atlassian (TEAM) declined 11.3% and E*Trade (ETFC) was down more than 1%.
Cryptocurrency Rally Intensifies
Crypto assets extended their recovery on Thursday, with the most popular altcoins leading the rally.
Ethereum rose 7.8% to $563, Ripple XRP gained 9.4% to $0.77 and bitcoin cash climbed 9.4% to $963.49 (all figures according to CoinMarketCap). Bitcoin also recorded gains, rising 1.4% to $8,287.88.As a result, the total value of the cryptocurrency market reached $358.4 billion, the highest since Mar. 14.
The rally coincided with the end of U.S. tax season after the IRS extended the reporting deadline by 24 hours. U.S. cryptocurrency traders may have been on the hook for as much as $25 billion in capital gains taxes, based on recent estimates. However, that number has not been confirmed.
The market’s impressive recovery comes even as nations such as India introduce new restrictions of digital currency trading. Earlier this month, the Reserve Bank of India banned regulated banks from facilitating cryptocurrency purchases.
While India is among the world’s fastest-growing nations, it is a small player in the cryptocurrency market. News of the crackdown sent bitcoin prices to a low of $5,400 on domestic exchanges. Bitcoin is still trading at a discount on Indian exchanges, although the spread is less than $200, based on Unocoin exchange data.
Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
Featured image courtesy of Shutterstock.
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