Direxion 3X Russell Funds (TNA)

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Dow drops more than 600 points for its worst day since October, S&P 500 goes red for the year

https://www.cnbc.com/2021/01/26/stock-market-futures-open-to-close-news.html

Federal Reserve officials left interest rates near-zero and pledged to continue making huge purchases of government-backed bonds as the central bank tries to help the United States economy weather the pandemic’s ongoing hit.

“The pace of the recovery in economic activity and employment has moderated in recent months, with weakness concentrated in the sectors most adversely affected by the pandemic,” the central bank’s policy-setting Federal Open Market Committee said in its January policy statement.

Fed Chair Jerome H. Powell, speaking at a news conference on Wednesday, said the resurgence of the virus was “weighing on economic activity and job creation,” and that the economic outlook hinges crucially on the pandemic itself.

https://www.nytimes.com/2021/01/27/business/economy/fed-interest-rates-economy.html
Delays in the rollout of Covid-19 vaccines, coupled with lingering lockdown measures, marked a "double whammy" of bad news for investors, said Hani Redha, a portfolio manager at PineBridge Investments.

"I think the market expected that by now we would be talking about loosening, not tightening restrictions," he said. "On the vaccine rollout, this is very problematic for the near term. It is very critical for shaping the growth bounce back, and these issues are just adding more delay to that."

The Dow Jones Industrial Average lost 633.87 points, or 2.1%, to 30,303.17 for its worst day since Oct. 28. The S&P 500 dropped 2.6% to 3,750.77, slipping from a record high and suffering its biggest drop in three months. Wednesday’s steep losses wiped out the 2021 gains for the S&P 500 and it’s now down 0.1% on the year. The tech-heavy Nasdaq Composite slid 2.6% to 13,270.60.

Boeing fell nearly 4% after its earnings report showed its 2020 net loss hit a record of $11.9 billion amid the 737 Max grounding and the coronavirus pandemic. Shares of AMD tumbled more than 6% even after the chipmaker posted revenue and earnings that beat Wall Street’s already high expectations.

But it was intensifying speculative behavior among retail investors that was causing the most concern. Heavily shorted names, including GameStop and AMC Entertainment, continued to be pushed higher by amateur day traders in online chat rooms. Some investors are worried about mounting losses by hedge funds spilling over to other areas of the market as those funds sell other securities to raise cash. Investors are also concerned the speculative behavior is a sign the market is overvalued and a pullback is near.

“We’ve run up so much and this is healthy profit taking,” said John Davi, founder and CIO of Astoria Portfolio Advisors. “There has been a tremendous market melt-up in the past two months. When the market goes up parabolically, you will see speculative behaviors from a lot of investors.”

AMC Entertainment Holdings Inc./ GameStop Corp.


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https://www.marketwatch.com/investing/stock/AMC/options

GameStop Corp.


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https://www.marketwatch.com/investing/stock/GME/options

Nokia


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https://www.marketwatch.com/investing/stock/NOK/options


SOXS Direxion Daily Semiconductor Bear 3X Shares (ETF)


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https://www.marketwatch.com/investing/stock/SOXS/options