With his presidential campaign gaining momentum, investors appear more spooked than ever by the prospect of a Sanders administration.
Billionaire Stanley Druckenmiller said on CNBC’s Squawk Box that stocks would plunge across the board if Sanders wins the presidency.
The market today has plunged to both news of Sanders’ growing momentum and the mounting fears of a coronavirus pandemic.
However, hedge fund manager Leon G. Cooperman, fears the prospect of a Sanders presidency has bigger implications for the stock market than a coronavirus pandemic.
“I don’t have any insight into the coronavirus, but I assume, with all the great minds of the world focused on this problem, that in three or four months this will become resolved,” Cooperman told CNBC.
Investors Business Daily has more:
The Dow Jones index was a sea of red, with only Verizon (VZ) eking out a tiny gain. UnitedHealth Group (UNH) was the biggest loser, plunging 7.5% in heavy trade to gap down below its 50-day moving average. The stock’s gain from a November breakout has been cut to 2%.
Managed care stocks were reeling from Bernie Sanders’ win in Saturday’s Democratic Caucus in Nevada. Sanders favors a government-run health care system, which would hurt private health insurers. Managed care providers, down nearly 7%, were some of the biggest losers among the 197 industry groups tracked by IBD.
Other blue chip losers included Disney (DIS), which gapped down below its 200-day line as it shed 5.5%. American Express (AXP), Apple (AAPL), Nike (NKE) and Exxon Mobil (XOM) lost more than 4% each.
Apple sank nearly 8% before halving its loss. But in afternoon trade it remained below its 50-day average, on track for its first close below the support line since August. Apple stock is still sharply extended from a 221.47 buy point of a flat base cleared in September. But Monday’s action is a stark reminder why the 20%-25% profit-taking rule can be a good idea.
Sanders leads the majority of Democratic primary polls, even nipping at Joe Biden’s heels in South Carolina despite losing to Hillary Clinton by 50 points there in 2016.