The Dow Jones Industrial Average declined 71 points, or 0.2%, to 28090 as U.S. markets opened on black Friday. The S&P 500 dropped 0.1%, and the Nasdaq Composite fell 0.2%. U.S. markets’ expectations for stock volatility has also dropped, with the Cboe Volatility Index, or VIX, trading at close to its lowest level in more than a year.
“The Thanksgiving holiday is usually a sign that the end of the year is in sight,” said Peter Dixon, an economist at Commerzbank in London. “If people have already made decent money this year, they are not going to risk it.”
Data on this months retail sales will provide investors with fresh insights on the strength of household spending. Over the last 6 months spending has grown with U.S. shoppers have been the economy’s driving force. Additionally, the U.S. and China remain confident they can sign a partial trade deal in the coming weeks as Beijing held off from retaliating after President Trump signed a bill supporting Hong Kong’s anti-government protesters.
Some investors, still concerned about the trade tensions, are taking a more cautious approach.
“You are seeing market participants prefer to lock in some profits because at least the ‘phase one’ trade deal is priced in by the market, as has a more accommodative stance from central banks,” said Daniel Lacalle, chief investment officer and economist at Madrid-based investment firm Tressis. “We are all concerned that there could be a bad end to a market that has gone so well in 2019.”
Meanwhile, the pan-continental Stoxx Europe 600 gauge edged down 0.1%.
Hong Kong’s equity benchmark Hang Seng Index fell 2%, posting its biggest decline in two weeks.
The Shanghai Composite Index ended the day down 0.6%.
Despite the positive direction between the US and China, the mood has soured in the past two days.
“Some people think the scenario may end up worse than [initially] expected,” he said.