Stocks fell Monday morning 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.
Crude oil prices rose 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, OPEC and its allies said they agreed to a production cut of nearly 10 million barrels per day to help ease a mounting supply glut – a margin of reduction 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 stabilization, with the growth-rate in domestic cases falling for a second straight day on Sunday, according to a Bloomberg analysis of Johns Hopkins data. U.S. cases were up 5.4% to top 542,000 Sunday afternoon, slowing from a rise of 5.6% Saturday and 7.9% on Friday.
In New York, the U.S. epicenter of the virus, the coronavirus-related death toll fell for a third straight day to 758 on Sunday. However, this marked the sixth consecutive day that deaths were more than 700 in a 24-hour period, underscoring that the death rate, while apparently plateauing, was doing so at a high level across the state. New York’s overall death toll was 9,385 as of Sunday.
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.
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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:
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S&P 500 (^GSPC): -54.77 points (-1.96%) to 2,735.05
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Dow (^DJI): -495.88 points (-2.09%) to 23,223.49
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Nasdaq (^IXIC): -75.42 points (-0.91%) to 8,080.96
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Crude oil (CL=F): +$0.65 (+2.86%) to $23.41 a barrel
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Gold (GC=F): -$8.70 (-0.50%) to $1,744.10 per ounce
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10-year Treasury (^TNX): +2.4 bps to yield 0.746%
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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.
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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:
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S&P 500 (^GSPC): -20.45 points (-0.73%) to 2,769.37
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Dow (^DJI): -170.93 points (-0.72%) to 23,548.44
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Nasdaq (^IXIC): -35.76 points (-0.45%) to 8,116.25
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Crude oil (CL=F): +$0.62 (+2.72%) to $23.38 a barrel
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Gold (GC=F): -$18.30 (-1.04%) to $1,734.50 per ounce
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10-year Treasury (^TNX): +2.1 bps to yield 0.743%
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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%.
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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.
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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.
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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:
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S&P 500 futures (ES=F): down 29.25 points, or 1.05% to 2,750.50
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Dow futures (YM=F): down 267 points, or 1.13% to 23,351.00
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Nasdaq futures (NQ=F): down 74.5 points, or 0.91% to 8,153.00
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Crude oil (CL=F): +$0.27 (+1.19%) to $23.03 a barrel
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Gold (GC=F): -$11.50 (-0.66%) to $1,741.30 per ounce
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10-year Treasury (^TNX): unchanged to yield 0.722%
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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%.
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S&P 500 futures (ES=F): down 51.75 points, or 1.86% to 2,728.00
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Dow futures (YM=F): down 437 points, or 1.85% to 23,181.00
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Nasdaq futures (NQ=F): down 135.75 points, or 1.65% to 8,091.75
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Crude oil (CL=F): -1.58%, or -$0.36 to $22.40
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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:
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S&P 500 futures (ES=F): down 2.25 points, or 0.08% to 2,777.5
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Dow futures (YM=F): down 12 points, or 0.05% to 23,606.00
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Nasdaq futures (NQ=F): down 3 points, or 0.09% to 8,220.5
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Crude oil (CL=F): +0.04%, or $0.01, to $22.77 per barrel
NEW YORK, NY – SEPTEMBER 19: Mayor of London Sadiq Khan rings the New York Stock Exchange Closing Bell at New York Stock Exchange on September 19, 2016 in New York City. (Photo by John Lamparski/Getty Images)
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