Barrons yesterday reported how Nasdaq is on fire. That title was probably created to catch more clicks on that day because everyone else reported how NASDAQ Composite (INDEXNASDAQ: IXIC) stopped going up after 6 days.
Situation seems to be the same on Wednesday for NASDAQ Composite Index as it is down almost 2.00% at 14:30 EDT. Stocks fell today as investors grappled with negative remarks from a top-ranking Federal Reserve official.
One of the biggest losers for the day is Facebook Inc. (NASDAQ:FB) stock which lost almost 3.00%.
Facebook plans to pay its content reviewers a total of $ 52 million in compensation for psychological stress at their work. The agreement provides that so-called moderators involved in a class action lawsuit will each receive $ 1,000. Affected individuals who have been diagnosed with mental illness in connection with their Facebook activity can expect medical treatment and damages of up to $ 50,000.
External contractors filed a lawsuit against the online social network in 2018. They accused Facebook of not protecting them adequately from the PTSD.
Trip.com Group Ltd (NASDAQ: TCOM) is another big loser on Wednesday as the future of travel stays bleak with no end in sight for the coronavirus crisis. Stock price went more than 3.5% down.
The mood of investors was also affected by the renewed tensions between the USA and China. A leading Republican senator proposed a law empowering President Donald Trump to sanction China if the People’s Republic does not provide enough information about the corona virus outbreak. Trump had blamed China for the pandemic and threatened new punitive tariffs. The Beijing government is now considering renegotiations on the trade agreement with the United States. On the other side, Trump seems to be spending more time on Twitter than ever.
As I have said for a long time, dealing with China is a very expensive thing to do. We just made a great Trade Deal, the ink was barely dry, and the World was hit by the Plague from China. 100 Trade Deals wouldn’t make up the difference - and all those innocent lives lost!— Donald J. Trump (@realDonaldTrump) May 13, 2020
With luck, and a good dose of intervention from the Fed(?), the hope is that recession mindset among investors — won’t last long.
The current recession might not be short and V-shaped as everyone thought it will. The stock market seems to agree with this assessment, for now. The market has rallied impressively over the past few weeks though the incoming economic data confirm that we are falling into a recession.