Global markets were under pressure Thursday as a fears over a coronavirus gripping the world’s second largest economy escalated further. However, U.S. markets bounced back in later afternoon trading to close positively.
4:32 p.m. ET: IBM CEO Ginny Rometty to retire
IBM announced Arvind Krishna, Senior Vice President for Cloud and Cognitive Software, will become CEO effective April 6, 2020. Krishna will be replacing current CEO Virginia Rometty, who will serve as executive chairman of the board through the end of the year.
"Arvind is the right CEO for the next era at IBM," said Rometty. "He is a brilliant technologist who has played a significant role in developing our key technologies such as artificial intelligence, cloud, quantum computing and blockchain. He is also a superb operational leader, able to win today while building the business of tomorrow.”
Rometty has been CEO since 2012.
4:20 p.m. ET: Stocks close in the green
Here’s where the major indices had settled as of 4:20 p.m. ET:
S&P 500 (^GSPC): +0.31% or +10.26 points to 3,283.66
Dow (^DJI): +0.43% or +124.99 points to 28,859.44
Nasdaq (^IXIC): +0.26% or +23.77 points to 9,298.93
Crude oil (CL=F): -0.96% or -0.51 to 52.82 a barrel
Gold (GC=F): +0.16% or +2.50 to 1,578.50 per ounce
3:20 p.m. ET: Stocks turn green in choppy session: Coronavirus jitters weigh
The Dow (^DJI) perks up in the final hour of trading, after spending most of the session in the red. While virus fears weigh, bargain-hunting may be partly counterbalancing that impulse. Other indexes are flat to slightly weaker as the last half-hour of trading closes in.
According to UBS Global Wealth Management CIO Mark Haefele:
"In our base case, we expect the outbreak of the virus not to cause a global economic slowdown. Assuming successful containment, we expect growth will subsequently rebound in future quarters due to pent-up demand and potential government stimulus. Overall, we estimate that China's 2020 growth could fall to 5.5%, from our previous estimate of 6.0%."
2:49 p.m. ET: World Health Organization declares coronavirus outbreak an international emergency
The World Health Organization designated the coronavirus outbreak an international emergency during a press conference Thursday. The coronavirus represents the first respiratory illness to be labeled an international emergency since the H1N1 flu pandemic of 2009.
“The main reason for this declaration is not because of what is happening in China, but because of what is happening in other countries,” Tedros Adhanom Ghebreyesus, Director-General of the WHO, said during the press conference.
“Our greatest concern is the potential for the virus to spread to countries with weaker health systems, and which are ill-preared to deal with it,” he added. “Let me be clear: This declaration is not a vote of no confidence in China. On the contrary, WHO continues to have confidence in China’s capacity to control the outbreak"
12:08 p.m. ET: Stocks hold lower as coronavirus cases climb
As of Thursday, the number of Wuhan coronavirus cases had topped 8,200, jumping above the number of cases reported during the 2002 to 2003 SARS outbreak. That outbreak two decades ago, however, had been more deadly, with 774 reported deaths versus the about 170 reported so far.
Big tech stocks led declines in the S&P 500, with Facebook shares slumping nearly 7% after quarterly results delivered after market close Wednesday failed to impress investors.
Here were the main moves in markets, as of 12:08 p.m. ET:
S&P 500 (^GSPC): -0.43% or -14.22 points to 3,259.18
Dow (^DJI): -0.29% or -83.13 points to 28,651.32
Nasdaq (^IXIC): -0.49% or -45.41 points to 9,229.54
Crude oil (CL=F): -2.08% or -1.11 to 52.22 a barrel
Gold (GC=F): +0.53% or +8.10 to 1,578.50 per ounce
12:01 p.m. ET: White House says China flight decisions will be left to airlines for now
The White House is allowing airlines to individually determine whether or not to fly to China amid the coronavirus outbreak in the region, President Donald Trump’s economic adviser Larry Kudlow told reporters in Washington, D.C., according to Bloomberg.
A number of airlines around the globe have already announced plans to reduce or temporarily stop the flights they operate to China, with some of these offering customer refunds. These include British Airways, United Airlines, American Airlines, Air Asia, Cathay Pacific, Air India, IndiGo, Lufthansa and Finnair.
9:39 a.m. ET: Tesla stock surge to fresh record high, topping $600 per share
Tesla (TSLA) shares held onto gains from overnight trading, sailing above $600 per share after reporting a fourth-quarter profit and progress in its Model Y roll-out. The car-maker said it expected to deliver more than 500,000 vehicles in 2020, up from 2019’s about 367,500 deliveries.
Fourth-quarter adjusted earnings per share were $2.14 on revenue of $7.38 billion, beating expectations for adjusted EPS of $1.74 on sales of $7.06 billion.
Shares were up more than 10% to $641.79 shortly after the opening bell Thursday.
9:32 a.m. ET: Stocks fall around market open
Stocks sank Thursday morning as fears over the coronavirus flared further. A mixed report on U.S. economic activity in the fourth quarter of last year did little to move the needle on the three major indices.
Here were the main moves in markets, as of 9:34 a.m. ET:
S&P 500 (^GSPC): -0.49% or -16 points to 3,257.4
Dow (^DJI): -0.37% or -105.27 points to 28,629.18
Nasdaq (^IXIC): -0.32% or -28.88 points to 9,246.39
Crude oil (CL=F): -2.48% or -1.32 to 52.01 a barrel
Gold (GC=F): +0.53% or +8.40 to 1,584.40 per ounce
9:04 a.m. ET: U.S. GDP beats expectations in the fourth quarter, but personal consumption slows more than anticipated
U.S. economic activity rose at a pace of 2.1% in the last three months of 2019, coming in ahead of consensus expectations. Personal consumption, however, slowed more than anticipated.
Here were the main metrics from the Bureau of Economic Analysis’s advanced fourth-quarter gross domestic product report, compared to consensus expectations compiled by Bloomberg:
4Q GDP annualized quarter over quarter: +2.1% vs. +2.0% expected and +2.1% in 3Q
Personal consumption: +1.8% vs. +2.0% expected and +3.2% in 3Q
Core personal consumption expenditures, quarter over quarter: +1.3% vs. +1.6% expected and +2.1% in 3Q
For the 12 months through the fourth quarter of 2019, U.S. GDP grew at a pace of 2.3%. This marked a deceleration from the 2.5% pace of gains seen in the 12 months through the end of 2018.
7:38 a.m. ET: Altria records $4.1 billion charge on Juul investment
Altria (MO) said in its quarterly earnings report Thursday that it recorded a fourth-quarter charge of $4.1 billion relating to its investment in Juul. The cigarette-maker had taken a 35% stake in Juul by investing some $12.8 billion in December 2018.
According to a statement from Altria:
“This impairment is primarily due to the increased number of legal cases pending against JUUL and the expectation that the number of legal cases against JUUL will continue to increase.
“Since October 31, 2019, the number of legal cases pending against JUUL has increased by more than 80%. Altria has not made any assumptions, or drawn any conclusions, regarding the merits or likelihood of success of any of these cases, litigation is subject to uncertainty and it is possible that there could be adverse developments in pending or future cases.”
Shares of Altria were little changed to slightly lower in early trading, after the company delivered fourth-quarter adjusted EPS and full-year guidance that was mostly in-line with expectations.
7:25 a.m. ET: Coca-Cola shares rise in early trading after fourth-quarter organic sales growth tops expectations
Food and beverage giant Coca-Cola (KO) delivered organic revenue growth that topped expectations, driven by better than anticipated increases in volumes sold across its beverage segments.
Coca-Cola delivered fourth-quarter comparable EPS of 44 cents, matching expectations. Overall organic sales growth, which strips out the impact of acquisitions and other items, rose 7%, better than the 4.9% increase expected, according to Bloomberg consensus data.
Unit case volume rose 3% in the quarter, better than the unchanged growth in the same period last year. Sparkling beverage unit case volumes rose 3%, reversing last year’s 1% decline, while water and sports drink volumes accelerated by 1 percentage point to a 2% gain. Juice and plant-based beverages were flat, but were better than last year’s 2% decline.
The stock was up nearly 1% pre-market, and is trading near new 52-week highs.
7:22 a.m. ET: Stock futures drop as coronavirus fatalities rise
U.S. stock futures were off in early trading, following equities in Asia and Europe lower as the death toll for the coronavirus in China rose further. The Shanghai Composite fell 2.75% on Thursday.
Crude oil prices sank further as fears that the virus and business closures it has spurred in China would impact demand for energy in the country. Gold prices rose and U.S. Treasuries were bid higher, sending yields sinking.
The coronavirus death toll rose by 38 to a total of 170 in China as of Thursday, according to the country’s National Health Commission, which also added that 170 people had been cured of the disease and discharged from medical facilities. The overall number of cases of the virus climbed above 7,700 in China, and India and the Philippines each reported their first cases of the coronavirus Thursday.
Here were the main moves during the pre-market session, as of 7:22 a.m. ET:
S&P futures (ES=F): 3,247.25, down 25.25 points or 0.77%
Dow futures (YM=F): 28,498.00, down 212 points or 0.74%
Nasdaq futures (NQ=F): 9,035.00, down 63.5 points or 0.7%
Crude oil (CL=F): $51.15 per barrel, down $1.18 or 2.21%
Gold (GC=F): $1,586.30 per ounce, up $10.30 or 0.65%
7:00 a.m. ET: Verizon Q4 boosted by Disney+ deal
The company reported earnings per share of $1.13, but added 790,000 postpaid phone customers — well above Wall Street’s estimates.