US open: Heavy losses on the Street, Buffett could go Republican
By Iain Gilbert
Date: Monday 24 Feb 2020
(Sharecast News) - US stocks recorded some heavy losses at the open as the number of Wuhan coronavirus cases accelerated outside of China.
As of 1540 GMT, the Dow Jones Industrial Average was down 2.99% at 28,126.73, while the S&P 500 had slumped 2.77% to 3,245.23 and the Nasdaq Composite started out the session 3.42% weaker at 9,249.39.
The Dow opened a whopping 865.68 points lower on Monday, following on from heavy losses seen at the end of last week as an increase in the number of new cases of the Wuhan coronavirus added to fears that a pronounced global economic slowdown was on the horizon.
In remarks to CNBC, Warren Buffett said investors should not let the coronavirus scare influence whether they buy or sell stocks, even as he reiterated his upbeat view on the long-term outlook for shares if interest rates and taxes remained low.
"It is scary stuff. I don't think it should affect what you do with stocks, but in terms of the human race it's scary stuff when you have a pandemic," he said.
He went on to endorse Mike Bloomberg's presidential candidacy but said: "I don't think another billionaire supporting him would be the best thing to announce. But sure, I would have no trouble voting for Mike Bloomberg."
Yet Buffett also appeared to leave the door open to voting Republican this time around, given Bernie Sanders' strong showing in the Democratic primaries.
Companies exposed to China took a hit in early trading on Monday, with the likes of Delta and American Airlines nosediving 7.38% and 8.38%, respectively, while United Airlines shares were flying 4.03% lower at the bell.
Shares of Nvidia were down 6.25%, while fellow chipmakers Intel and AMD were down 3.42% and 7.79%, respectively. Apple was down 4.43% at the open.
Market participants were keeping a keen eye on developments surrounding the outbreak, which has now spread rapidly to the likes of South Korea and Italy - which officially became the most affected country outside of Asia, with more than 130 reported cases and three deaths.
South Korea raised its alert to the "highest level" as the total number of people infected topped 750 - making it the nation with the most cases outside of mainland China.
In response, the yield on the benchmark 10-year Treasury note fell to 1.397% on Monday, putting the key rate close to an all-time low, while gold futures climbed more than 2% to roughly $1,685 per ounce.
Kingswood's chief investment officer Rupert Thompson said: "The recent spread of the virus outside of China, with Korea and Italy both now imposing quite radical containment measures, has spooked equity markets.
"While cases outside China are rising fast, which is undoubtedly worrisome, one should not lose sight of the fact that they are still below 2,500. This is dwarfed by the 77,000 cases in China, where the latest news has actually been very reassuring."
On the macro front, the Chicago Fed National Activity Index inched higher in January, signalling growth across the region. The index ticked up to -0.25 in January, versus the -0.51 reading in December, according to the Federal Reserve Bank of Chicago.
Elsewhere, the Federal Reserve Bank of Dallas' general business activity index for manufacturing in Texas rose to 1.2 in February 2020, up from a reading of -0.2 in January. While the figures were below market expectations, it was still the highest reading seen since September.
In the corporate space, Etsy, Hertz Global Technologies and Shake Shack will report earnings throughout the course of the day.
Dow Jones - Risers
Dowdupont Inc. (DWDP) $30.52 0.00%
Verizon Communications Inc. (VZ) $58.12 -0.14%
Merck & Co. Inc. (MRK) $82.10 -0.29%
Travelers Company Inc. (TRV) $134.47 -0.51%
Coca-Cola Co. (KO) $59.49 -1.07%
McDonald's Corp. (MCD) $213.54 -1.08%
Walmart Inc. (WMT) $117.27 -1.10%
Home Depot Inc. (HD) $241.89 -1.41%
Pfizer Inc. (PFE) $35.21 -1.44%
Procter & Gamble Co. (PG) $124.64 -1.62%
Dow Jones - Fallers
Unitedhealth Group Inc. (UNH) $282.18 -6.39%
American Express Co. (AXP) $129.41 -4.07%
Walt Disney Co. (DIS) $133.43 -3.99%
Apple Inc. (AAPL) $300.90 -3.88%
Exxon Mobil Corp. (XOM) $57.09 -3.45%
Visa Inc. (V) $201.63 -3.44%
Nike Inc. (NKE) $96.97 -3.27%
Cisco Systems Inc. (CSCO) $44.79 -3.24%
Microsoft Corp. (MSFT) $173.03 -3.11%
Intel Corp. (INTC) $62.40 -3.02%
S&P 500 - Risers
Gilead Sciences Inc. (GILD) $73.52 5.48%
Newmont Corporation (NEM) $50.81 2.76%
Clorox Co. (CLX) $166.79 1.31%
Extra Space Storage (EXR) $110.54 1.23%
CME Group Inc. (CME) $211.30 1.18%
Sba Communications Corp. (SBAC) $298.29 0.89%
Cabot Oil & Gas Corp. (COG) $15.02 0.84%
Kroger Co. (KR) $30.51 0.68%
Realty Income Corp. (O) $82.89 0.55%
Healthpeak Properties, Inc (PEAK) $37.26 0.28%
S&P 500 - Fallers
American Airlines Group (AAL) $25.57 -8.11%
Centene Corp. (CNC) $60.20 -8.08%
Westrock Company (WRK) $37.69 -7.74%
Norwegian Cruise Line Holdings Ltd (NCLH) $43.36 -7.69%
Align Technology Inc. (ALGN) $241.30 -7.28%
Tapestry Inc. (TPR) $25.96 -7.27%
Devon Energy Corp. (DVN) $19.49 -7.08%
Advanced Micro Devices Inc. (AMD) $49.56 -6.97%
Booking Holdings Inc. (BKNG) $1,797.84 -6.79%
Cimarex Energy Co (XEC) $39.62 -6.75%
Nasdaq 100 - Risers
Gilead Sciences Inc. (GILD) $73.52 5.48%
Celgene Corp. (CELG) $108.24 0.00%
Shire Plc Ads (SHPG) $179.20 0.00%
Ross Stores Inc. (ROST) $122.49 -0.61%
Take-Two Interactive Software Inc. (TTWO) $115.24 -0.68%
Verisk Analytics Inc. (VRSK) $167.54 -0.68%
Monster Beverage Corp (MNST) $69.25 -0.70%
Electronic Arts Inc. (EA) $107.13 -0.81%
Charter Communications Inc. (CHTR) $530.68 -0.87%
Activision Blizzard Inc. (ATVI) $62.78 -0.94%
Nasdaq 100 - Fallers
American Airlines Group (AAL) $25.57 -8.11%
Align Technology Inc. (ALGN) $241.30 -7.28%
Mercadolibre Inc. (MELI) $685.03 -6.87%
Booking Holdings Inc. (BKNG) $1,797.84 -6.79%
Expedia Group Inc. (EXPE) $113.39 -5.61%
Trip.com Group Limited (TCOM) $31.30 -5.32%
Tesla Inc (TSLA) $854.14 -5.20%
Marriott International - Class A (MAR) $136.06 -5.01%
Nvidia Corp. (NVDA) $279.34 -5.01%
Applied Materials Inc. (AMAT) $61.08 -4.96%
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