As Hurricane Sandy Reaches East Coast, Stocks Drop
Hurricane Sandy’s arrival will close equity markets on Monday as the U.S. stock-index futures continue to fall, Bloomberg reports. No notice has been given of when they will reopen as Hurricane Sandy continues to gain strength and hit New York City.
The physical trading floors and electronic trading of the New York Stock Exchange, Nasdaq and the CME Group in Chicago, closed in agreement with emergency actions called by government officials as the imminent Hurricane Sandy nears, The Street reports.
Bloomberg spoke with Peter Jankovskis, co-chief investment officer for Oakbrook Investments in Lisle, Illinois, about the dismal stock future as Hurricane Sandy moves into New York City:
“The market is factoring in the potential damage from the storm. It looks like it could be quite substantial. It’ll naturally have an impact on insurance companies but other companies by putting a crimp on sales in the areas affected by the storm.”
Equity trading was cancelled on all markets today by the U.S. securities industry, in order to move workers to safer conditions as Sandy reaches New York City with wind speeds approaching 85 MPH and the danger of an 11-foot sea surge.
It has been 27 years since the last time the NYSE, a unit of NYSE Euronext, has closed down because of weather conditions.
According to Sam Stovall, chief equity strategist at S&P Capital IQ, Hurricane Sandy will result in uneven effects:
“Individually, the market’s performance following major hurricanes has been uneven, as equities are more likely driven by wider-reaching global events than localized natural disasters. On average, however, the S&P 500 rose between 3% and 6% in the subsequent one through six months. Of course there is no guarantee that history will repeat itself.”