Stocks open lower on Wall Street following three-day rally

Photo: The Canadian Press

Stocks are opening lower on Wall Street as the market gives back some of the gains it piled up over the past three days.

Major indexes are down about 3% in early trading Friday.

The S&P 500 had shot up 17% over the previous three days as traders became hopeful that Congress would pass a $2 trillion coronavirus relief package.

The bill has made it through the Senate and is expected to pass the House soon.

Even after the rally this week the market is down 25% from the peak it reached a month ago. European markets also fell.

The Dow Jones industrial average was down 948.83 points at 21,603.34. The S&P 500 index was down 102.69 points at 2,527.38, while the Nasdaq composite was down 295.66 points at 7,501.88.

Canada's main stock index also fell at the start of trading after rallying this week.

The S&P/TSX composite index was down 542.18 points at 12,828.99.

The Canadian dollar traded for 70.80 cents US compared with an average of 71.04 cents US on Thursday.

Germany's DAX fell 3.2% to 9,687 while the CAC 40 in Paris gave up 4% to 4,363. Britain's FTSE 100 sank 4.6% to 5,551 81.51 after Prime Minister Boris Johnson was diagnosed positive for the COVID-19 virus.

“Rallies don't last forever and clearly investors are happy to call time on this one as we head into another uncertain weekend," Craig Erlam of Oanda said in a report.

“We may have had a good run this week but the weekend can feel like a long time at moments like this and the numbers we're getting from the U.S., which now has more cases than China or Italy, are getting uglier by the day," he said.

Still, Asian markets mostly rose as governments tightened controls on businesses and travel, seeking to contain the pandemic.

Japan's Nikkei 225 index surged 3.9% to 19,389.43, while South Korea's Kospi jumped 1.9% to 1,717.73. The Hang Seng in Hong Kong advanced 0.6% to 23,484.28, while the Shanghai Composite index edged 0.3% higher to 2,772.20. Shares fell in Taiwan but rose in Southeast Asia.

India's Sensex rebounded, gaining 0.7% to 30,148.36 after the central bank slashed its key lending rate to a decade-low 4.4% from 5.15% to help the economy weather a lockdown aimed at beating the outbreak in the world's second most populous country. Sydney's S&P/ASX 200 slipped to 4,842.40.