Rise in new coronavirus cases and loss in tech stocks pushed the S&P 500 and the Nasdaq to end in the red, while the Dow cling to a modest gain on Monday. News of California rolling back reopening plans clouded investors’ sentiment and overshadowed positive announcements regarding vaccine development.
The Dow Jones Industrial Average (DJI) rose 10.50 points, or less than 0.1%, to close at 26,085.80 and the S&P 500 fell 29.82 points, or 0.9% to close at of 3,155.22. The Nasdaq Composite Index closed at 10,390.84, fell 226.60 points, or 2.1%. The fear-gauge CBOE Volatility Index (VIX) increased nearly 18%, to close at 32.19. Declining issues outnumbered advancing ones for 1.56-to-1 ratio on the NYSE and a 2.11-to-1 ratio on the Nasdaq favored decliners.
How Did the Benchmarks Perform?
On Monday, rally in technology and tech-related stocks frizzed out putting the S&P 500 and the Nadsaq in the negative territory. Out of the 11 major sectors of the S&P 500, seven ended in the red with the technology and communication service sector closing nearly 2% lower.
Tech giants like Facebook, Inc. FB, Amazon.com, Inc. AMZN, Netflix, Inc. NFLX closed at least 2.5% lower, while and Alphabet Inc. GOOGL declined 1.7% on Jul 13. In fact, several work-from-home stocks that had outperformed in recent months also registered steep decline. Shares of Workday, Inc. WDAY, Adobe Inc. ADBE and Autodesk, Inc. ADSK closed at least 5% lower for the day.
Overall, the S&P 500 posted 38 new 52-week highs and no new lows, while the Nasdaq Composite recorded 128 new highs and 22 new lows.
California Makes U-turn in Reopening Plans
On Monday, California’s Gov. Gavin Newsom ordered every county in the state to shut bars, indoor dining, movie theaters and wineries, on account of soaring new coronavirus cases. The state has registered 8,350 new cases on Jul 13, bringing the total new cases across the United States to 65,488.
Additionally, Florida and Texas have registered 12,624 and 9,156 new cases on Monday. On the same day, New York Gov. Andrew Cuomo issued an emergency health order that requires all travelers to New York from high-COVID infected states to provide location details or face a $2000 fine. He also announced plans to reopen New York schools in the fall if the infection rates are below 5% based on 14-day averages.
FDA Fast Tracks Pfizer and BioNTech’s Vaccine Candidates
On Monday, the Food and Drug Administration (FDA) granted two of Pfizer Inc. PFE and BioNTech SE’s BNTX COVID-19 vaccine candidates’ fast track designation. Pfizer and BioNTech expect to start the next phase of the vaccine trial later in July with 30,000 subjects. On meeting positive results the companies expect to make 100 million doses of a vaccine by the end of this year and more than 1.2 billion doses by the end of 2021.
Shares of Pfizer and BioNTech that carry a Zacks Rank #3 (Hold) closed 4.1% and 10.6% higher, respectively on Monday. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Q2 Earnings Report
On Monday, shares of PepsiCo, Inc. PEP rose 0.3% after the company reported second-quarter 2020 earnings of $1.32 per share surpassing the Zacks Consensus Estimate of $1.25. The company also posted revenues of $15.95 billion for the quarter ended June 2020, surpassing the Zacks Consensus Estimate by 2.59%. The company has reported better-than-expected performance despite the challenges presented by the coronavirus pandemic.
In fact, the resilience in the global snacks and foods business attributed to the results. Additionally, Pepsico’s strong portfolio of brands, responsive supply chain and flexible go-to-market systems have helped it maintain supplies amid the pandemic. (Read More)
Stocks that Made Headline
Netflix Set to Release Romantic Series Emily In Paris
Netflix has landed the new romantic comedy series Emily In Paris, originally developed and greenlighted by ViacomCBS VIAC owned Paramount Network. The half-hour series will be released exclusively on the streaming service this fall. (Read More)
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Amazon.com, Inc. (AMZN) : Free Stock Analysis Report
Pfizer Inc. (PFE) : Free Stock Analysis Report
Autodesk, Inc. (ADSK) : Free Stock Analysis Report
Adobe Systems Incorporated (ADBE) : Free Stock Analysis Report
Netflix, Inc. (NFLX) : Free Stock Analysis Report
PepsiCo, Inc. (PEP) : Free Stock Analysis Report
Workday, Inc. (WDAY) : Free Stock Analysis Report
Facebook, Inc. (FB) : Free Stock Analysis Report
Alphabet Inc. (GOOGL) : Free Stock Analysis Report
BioNTech SE Sponsored ADR (BNTX) : Free Stock Analysis Report
ViacomCBS Inc. (VIAC) : Free Stock Analysis Report
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