Stocks end lower but remain near record highs

Stocks end lower but remain near record highs

The surge in volatility was reflected in the VIX, a measure of fear in the USA stock market, which surged more than 60% to its highest level since October 30. In Australia, the S&P/ASX 200 lost 0.8%.

Johnson & Johnson rose 2.7% after the company reported fourth-quarter results that cruised past Wall Street's expectations. "We have a bit of a ideal storm heading into the month end, which is weighing on equity markets, but I don't think at the moment we are in a place where it's going to come crashing off", Hewson said.

Gamestop shares closed 18.12% higher in volatile trading in a session that saw the video game retailer climb as high as $159.18 and drop as low as $61.13 on the day as investors rushed to cover short bets.

President Joe Biden has proposed a $1.9 trillion plan to send $1,400 to most Americans and deliver other support for the economy.

U.S. stocks rose in choppy trading on Tuesday, with the S&P 500 scaling a new peak, after a batch of upbeat earnings updates including Johnson & Johnson's strong profit forecast and 3M's quarterly profit beat.

"Not all of those things are playing out in a clear way", said Sylvia Jablonski, chief investment officer of Defiance ETFs.

The Dow Jones Industrial Average fell 575.3 points, or 1.86%, at the open to 30,361.35. The tech-heavy Nasdaq Composite Index slid 9.93 points, or 0.07%, to 13,626.06.

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The Russell 2000 index of smaller companies fell 5.49 points, or 0.3%, to 2,163.27.

Wall Street headed for mixed start on Thursday with investors preparing for the latest snapshot of economic growth and any signs that a big squeeze in shorted stocks has more to run. "I think when it backed off a little bit, the market breathed a sigh of relief", said Thomas Hayes, managing member at Great Hill Capital LLC in NY.

More than 100 S&P 500 companies are expected to tell investors this week how they performed over the last three months of 2020.

Investors are also focusing on company earnings. As a whole, analysts expect S&P 500 companies to say their fourth-quarter profit fell 5% from a year earlier.

Boeing dropped 4% after the aircraft manufacturer posted its largest annual loss in the company's history, mostly due to the grounding of Boeing's 737-MAX fleet.

Markets have meandered near record highs since last week as investors weighed solid corporate earnings results against renewed worries that troubles with COVID-19 vaccine rollouts and the spread of new variants of coronavirus might delay a recovery from the pandemic. It gave up 16 cents to $52.77 per barrel on Tuesday.

Still, a late push higher sent both the S&P and Nasdaq to closing records, after Biden revealed his plan to boost domestic manufacturing through US government purchases. The euro slipped to $1.2158 from $1.2162. Brent crude, the global standard, fell 20 cents to $55.61 a barrel.

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