Investor sentiment sagged as concern about President Joe Biden’s economic agenda and the omicron coronavirus surge dragged down stocks. Traders said lower volume ahead of the holidays exacerbated market moves.

The S&P 500 had its biggest three-day drop since September, led by losses in financial and material shares. Bonds fell. The dollar was little changed.

“There’s kind of two dynamics going on. Probably the most important one is the imminent reduction in liquidity,” said Jay Hatfield, chief executive officer at Infrastructure Capital Management. “On top of that, you have the omicron concern.”

Goldman Sachs Group Inc. economists cut their U.S. growth forecasts after Democratic Senator Joe Manchin blindsided the White House by rejecting Biden’s roughly US$2 trillion tax-and-spending package. Meanwhile, Europe’s biggest nations weighed more Covid-19 restrictions.

Some of the main moves in markets:

Stocks

  • The S&P 500 fell 1.1 per cent as of 4 p.m. New York time
  • The Nasdaq 100 fell 1.1 per cent
  • The Dow Jones Industrial Average fell 1.2 per cent
  • The MSCI World index fell 1.4 per cent

Currencies

  • The Bloomberg Dollar Spot Index was little changed
  • The euro rose 0.3 per cent to US$1.1278
  • The British pound fell 0.3 per cent to US$1.3209
  • The Japanese yen was little changed at 113.67 per dollar

Bonds

  • The yield on 10-year Treasuries advanced two basis points to 1.42 per cent
  • Germany’s 10-year yield advanced one basis point to -0.37 per cent
  • Britain’s 10-year yield advanced one basis point to 0.77 per cent

Commodities

  • West Texas Intermediate crude fell 3.7 per cent to US$68.23 a barrel
  • Gold futures fell 0.9 per cent to US$1,789.40 an ounce