While the stock market has been riding high since the creation of several COVID-19 vaccines, bringing economic recovery with it, that wave came crashing down Tuesday. U.S. stock futures fell after officials called for a pause in the use of the Johnson&Johnson vaccine over reports of a “rare and severe” type of blood clot. Dow (INDU) futures were down 68 points, or 0.2%. S&P 500 (SPX) futures were flat. Nasdaq (COMP) futures were 0.4% lower. If the market has you thinking about moving some funds around, there’s still a way to do it that’s penalty-free.
CNN Business/David Goldman
Dow futures sink after US urges pause on Johnson & Johnson Covid-19 vaccine
Wall Street has been riding high as America’s vaccination program exceeded expectations, lifting prospects of a speedy economic recovery. But a potential major disruption to that campaign sent stocks in reverse Tuesday, CNN reports.
US stock futures fell after the United States urged a pause to the one-dose Johnson & Johnson Covid-19 vaccine. Stock futures had previously been flat ahead of a key inflation report that assuaged Wall Street’s fears about rising prices. Investors weren’t in panic mode, but the news was certainly unwelcome on Wall Street.
Dow (INDU) futures were down 68 points, or 0.2%. S&P 500 (SPX) futures were flat. Nasdaq (COMP) futures were 0.4% lower.
Johnson & Johnson’s (JNJ) stock fell 2.5% in premarket trading.
The US Centers for Disease Control and Prevention and the US Food and Drug Administration are recommending that the United States halt the use of Johnson & Johnson’s Covid-19 vaccine over six reported US cases of a “rare and severe” type of blood clot.
The Johnson & Johnson vaccine was expected to help the United States ramp up its vaccination program, as the one-dose shot leads to quicker immunization timetables. The other two vaccines in use — Pfizer and Moderna’s — are two-dose vaccines. They are not affected by Tuesday’s pause request.
The fact that two other vaccines will remain in use may have helped keep stocks from tumbling. Also, reports of blood clots after receiving the J&J shot are rare: The six reported cases were among more than 6.8 million doses of the Johnson & Johnson vaccine administered in the United States.
Smart Asset/Ben Geier
COVID Relief: Penalty-Free 401(k) & IRA Withdrawals
As part of the CARES Act, which was passed in 2020, there is a provision temporarily amending the rules for taking early distributions from retirement savings plans, including 401(k) plans and individual retirement accounts (IRAs).
Essentially, if you needed cash, you could take up to $100,000 from your retirement plan, even if you are under the normal minimum age of 59.5, without being assessed the 10% penalty charged on early withdrawals. These withdrawals are still treated as normal income, though, so you’ll have to pay regular taxes on it. That is unless you own a Roth account.
This income can be spread over up to three years so your income isn’t too high in a single year. If you need help figuring out how to manage your withdrawals, consider working with a financial advisor.
When there isn’t a global pandemic impacting the livelihoods of the entire nation, withdrawing money early from a retirement plan is a serious decision. That’s because it carries with it some pretty serious consequences: namely, a 10% penalty paid on all of the money you withdraw, in addition to paying normal taxes. This, of course, assumes it is not a Roth plan, where the money has already been taxed.
Read more about withdrawing from a 401(k) or IRA for COVID reasons, here.
Inflation is here, but it is ‘transitory’: Investment strategist
U.S. Bank Wealth Management Senior Investment Strategist Rob Haworth discusses how to get ahead of inflation, what it will look like, and industrial stocks.
You can watch the full video, here.