Stocks ended Monday’s session on a mixed note ahead of the start of corporate earnings season, declining after last week’s rally sent the S&P 500 to its best weekly gain since 1974. The Nasdaq ended in positive territory, boosted by a 6% gain in tech heavyweight Amazon, but the broader market was weighed by ongoing economic fears stemming from the coronavirus crisis.
Crude oil prices rose, but then settled lower after President Donald Trump said in a Twitter post Monday morning that OPEC+ oil output cuts would be double the amount reported earlier.
On Sunday, the cartel and its allies said they agreed to a production cut of nearly 10 million barrels per day to help ease a mounting supply glut. However, that margin of reduction was something that analysts at Goldman Sachs called “insufficient” to stem a supply glut as the coronavirus simultaneously dents energy demand.
Over the weekend, coronavirus cases in the U.S. showed some broadening signs of stabilizing, with the growth-rate in domestic cases falling for a second straight day on Sunday, according to a Bloomberg analysis of Johns Hopkins data.
Institutions around the world have been working at a breakneck pace to try and develop a vaccine for the novel coronavirus. Seventy vaccines are currently in development and three have already begun testing in human trials, the World Health Organization said in a weekend update.
With early signs of a leveling off of new cases, officials have addressed the notion of alleviating the social distancing measures put in place over the past several weeks across the country.
Dr. Anthony Fauci, director of the National Institute of Allergies and Infection Diseases, said on CNN that loosening social distancing measures in some parts of the nation “could probably start at least in some ways maybe next month,” while acknowledging that the easing “is not going to be a light switch” and will instead be a more gradual “rolling reentry.”
But even when social distancing begins to let up, it likely won’t spell the end of coronavirus-containment policies, with months more of these measures likely to occur in fits and starts, according to one Federal Reserve official.
Neel Kashkari, Federal Reserve Bank of Minneapolis President, said on CBS Sunday that “we should all be focusing on an 18-month strategy for our health care system and our economy.” Looking at other countries coping with the outbreak, he noted that relaxing economic controls tended to lead to another flare-up in the coronavirus, necessitating renewed social distancing measures.
Whether the only or one of many, the current wave of social distancing measures assembled through a patchwork of state, local and federal mandates has already dented the U.S. economy, leading millions of individuals to become unemployed in the past several weeks alone. New economic data set for release later this week is expected to show a sharp drop in retail sales and new-home construction as the coronavirus outbreak grinds business activity across many sectors to a halt.
“We have always said the V-shaped recovery was too optimistic, but waves of subsequent shutdowns mean that our gradual recovery is too optimistic, as well,” Seth Carpenter, chief U.S. economist for UBS, wrote in an email Sunday.
4:02 p.m. ET: Dow ends lower by 328 points, or 1.4%. Nasdaq ends slightly higher as Amazon, Netflix climb
Here were the main moves in markets as of 4:02 p.m. ET:
S&P 500 (^GSPC): -28.19 (-1.01%) to 2,761.63
Dow (^DJI): -328.60 (-1.39%) to 23,390.77
Nasdaq (^IXIC): +38.85 (+0.48%) to 8,192.42
Crude (CL=F): -$0.08 (-0.35%) to $22.68 a barrel
Gold (GC=F): +$11.70 (+0.67%) to $1,764.50 per ounce
10-year Treasury (^TNX): +2 bps to yield 0.7490%
2:45 p.m. ET: Crude oil reverses course to settle lower as investors worry output cuts won’t offset demand slump
Domestic crude oil prices settled 1.5% lower to $22.41 per barrel even after OPEC+ announced Sunday its largest single output cut on record. Many market participants feared the cuts would not go far enough to offset a drop in energy demand amid the coronavirus pandemic.
Earlier, U.S. West Texas intermediate crude prices had been up as much as 8%.
11:11 a.m. ET: Trump says decision to reopen economy will be ‘the decision of the President’
President Donald Trump said Monday morning that the decision to ease social distancing measures and reopen the economy would ultimately be his, “in conjunction with the Governors and input from others.”
....It is the decision of the President, and for many good reasons. With that being said, the Administration and I are working closely with the Governors, and this will continue. A decision by me, in conjunction with the Governors and input from others, will be made shortly!
— Donald J. Trump (@realDonaldTrump) April 13, 2020
11:00 a.m. ET: Why Wall Street is bullish on stocks again
On Monday, Jefferies and Goldman Sachs recommended investors buy in to beaten-down stocks — with the latter saying a new bull run was in the making.
In an interview with Yahoo Finance this morning, Ben Mandel, global strategist at JP Morgan Asset Management, gave some insight as to why that is. Mandel stated that bonds are “super expensive” given massive safe-haven buying amid the pandemic, and that he’s expecting another retest of last month’s lows.
Still, Mandel also cautioned that its “hard to say” whether stocks are actually cheap right now, but that given the current environment, equities “look a little better” relative to bonds.
10:46 a.m. ET: Stocks fall further, Dow sheds 400+ points
Stocks extended losses as trading rolled on Monday morning.
The Real Estate and Financials sectors led declines in the S&P 500. Caterpillar and American Express were the biggest laggards in the Dow, dropping 8.4% and 6.5%, respectively.
Here were the main moves in markets, as of 10:46 a.m. ET:
S&P 500 (^GSPC): -54.77 points (-1.96%) to 2,735.05
Dow (^DJI): -495.88 points (-2.09%) to 23,223.49
Nasdaq (^IXIC): -75.42 points (-0.91%) to 8,080.96
Crude oil (CL=F): +$0.65 (+2.86%) to $23.41 a barrel
Gold (GC=F): -$8.70 (-0.50%) to $1,744.10 per ounce
10-year Treasury (^TNX): +2.4 bps to yield 0.746%
10:28 a.m. ET: Amazon says it will hire another 75,000 employees as demand remains elevated
Amazon said Monday it is hiring another 75,000 workers across its warehouse, shopper and delivery roles as social distancing measures sharply increase demand for the company’s delivery services.
The new positions will be in addition to the 100,000 the company already brought on over the past four weeks, it said in the statement.
“We know many people have been economically impacted as jobs in areas like hospitality, restaurants, and travel are lost or furloughed as part of this crisis and we welcome anyone out of work to join us at Amazon until things return to normal and their past employer is able to bring them back,” according to the statement. “We also continue to invest in pay increases and previously expected to spend $350 million to increase wages during this unprecedented time—we now expect that to be over $500 million.”
Shares of Amazon were up 2.9% to $2,102.51 each as of 10:29 a.m. ET, outperforming the broader market.
9:33 a.m. ET: Stocks open lower, Dow drops 100+ points
Stocks kicked off Monday’s session on the decline, edging lower after the holiday weekend in the U.S.
Here were the main moves in markets, as of 9:33 a.m. ET:
S&P 500 (^GSPC): -20.45 points (-0.73%) to 2,769.37
Dow (^DJI): -170.93 points (-0.72%) to 23,548.44
Nasdaq (^IXIC): -35.76 points (-0.45%) to 8,116.25
Crude oil (CL=F): +$0.62 (+2.72%) to $23.38 a barrel
Gold (GC=F): -$18.30 (-1.04%) to $1,734.50 per ounce
10-year Treasury (^TNX): +2.1 bps to yield 0.743%
9:31 a.m. ET: Trump says OPEC+ oil production cuts will total 20 million barrels per day, not 10 million
President Donald Trump in a Twitter post Monday morning said OPEC and allied nations will cut oil production by a total of 20 million barrels per day, or greater than the 9.7 million suggested in the production group’s press release Sunday.
Prices for Brent crude oil, the international standard, rose about 0.8% after the Twitter post, after trading lower earlier. West Texas intermediate oil rose 2.4%.
....disaster, the Energy Industry will be strong again, far faster than currently anticipated. Thank you to all of those who worked with me on getting this very big business back on track, in particular Russia and Saudi Arabia.
— Donald J. Trump (@realDonaldTrump) April 13, 2020
9:10 a.m. ET: Airline revenues set to plunge 44%, IATA says
In an updated analysis, the International Air Transport Association (IATA) expects the aggressive travel restrictions and social distancing to carve $252 billion from airlines’ revenues, a figure that represents a 44% plunge from 2019.
As the debate rages over how to restart the U.S. economy, the organization’s baseline imputes travel curbs will last for “up to three months, followed by a gradual economic recovery later this year.” It gets worse, with the IATA expecting a recovery to get dampened by a global recession on jobs and confidence.
“The airline industry faces its gravest crisis. Within a matter of a few weeks, our previous worst case scenario is looking better than our latest estimates. But without immediate government relief measures, there will not be an industry left standing. Airlines need $200 billion in liquidity support simply to make it through. Some governments have already stepped forward, but many more need to follow suit,” said IATA’s Director General and CEO, Alexandre de Juniac.
In other words, forget about the ‘V-shaped’ recovery.
7:41 a.m. ET: SoftBank anticipates a $16.5 billion full-year loss for Vision Fund as tech investments wither
Japanese conglomerate SoftBank Group said in a statement Monday it expects its $100 billion Vision Fund will see a loss of 1.8 trillion yen, or about $16.5 billion, for the fiscal year ending in March, as its investments in tech giants sank amid the coronavirus pandemic.
SoftBank said its Vision Fund – which has taken stakes in WeWork, Uber and Tik Tok-owner ByteDance – has experienced losses due to a “decrease in the fair value of investments due to the deteriorating market environment.”
SoftBank anticipates the company as a whole will see a record operating loss of 1.35 trillion yen, or about $12.5 billion, for the fiscal year ending in March.
7:10 a.m. ET Monday: Futures hold lower, signaling lower start to the week
Stock futures held lower during the overnight session and headed toward a lower open to kick off the week.
Here were the main moves in markets, as of 7:10 a.m. ET:
S&P 500 futures (ES=F): down 29.25 points, or 1.05% to 2,750.50
Dow futures (YM=F): down 267 points, or 1.13% to 23,351.00
Nasdaq futures (NQ=F): down 74.5 points, or 0.91% to 8,153.00
Crude oil (CL=F): +$0.27 (+1.19%) to $23.03 a barrel
Gold (GC=F): -$11.50 (-0.66%) to $1,741.30 per ounce
10-year Treasury (^TNX): unchanged to yield 0.722%
6:18 p.m. ET: Stock futures add to losses
Contracts on the three major indices extended declines as overnight trading, with futures on each of the S&P 500, Dow and Nasdaq off more than 1.5%.
S&P 500 futures (ES=F): down 51.75 points, or 1.86% to 2,728.00
Dow futures (YM=F): down 437 points, or 1.85% to 23,181.00
Nasdaq futures (NQ=F): down 135.75 points, or 1.65% to 8,091.75
Crude oil (CL=F): -1.58%, or -$0.36 to $22.40
6:09 p.m. ET Sunday: Stock futures roughly flat after long weekend
Here were the main moves at the start of the overnight session for U.S. equity futures, as of 6:09 p.m. ET on Sunday:
S&P 500 futures (ES=F): down 2.25 points, or 0.08% to 2,777.5
Dow futures (YM=F): down 12 points, or 0.05% to 23,606.00
Nasdaq futures (NQ=F): down 3 points, or 0.09% to 8,220.5
Crude oil (CL=F): +0.04%, or $0.01, to $22.77 per barrel