Monthly Archives: January 2020

Stocks making the biggest moves midday: Intel, Boeing, Disney & more

The Intel logo is displayed outside of the Intel headquarters in Santa Clara, Calif.

Justin Sullivan | Getty Images

Check out the companies making headlines in midday trading.

Boeing — Boeing’s stock turned negative on the day after CNBC confirmed the aerospace giant is considering an added cut to the production of its 787 Dreamliner aircraft. With its 737 Max line already grounded longer than expected, issues at Boeing’s commercial airplanes unit continue to expand.

American Express — Shares of the payments company rose more than 2% and hit a record on the back of stronger-than-forecast quarterly numbers. American Express posted a profit of $2.03 per share. Analysts polled by Refinitiv expected earnings per share of $2.01. The company said card-fee revenues were a key driver for the quarter’s bottom line.

Intel — Shares of the chip name surged more than 8% to their highest level since Sept. 2000 after the company beat fourth-quarter estimates and gave optimistic guidance for the first quarter of 2020. Revenue grew 8% year-over-year, fueled by the company’s Client Computing Group.

Broadcom, Skyworks — Broadcom rose 1.5% in midday trading after announcing a pair of supplier agreements with Apple late Thursday. The chipmaker estimated the deals would be worth $15 billion and said they apply to wireless components that will be used in Apple products launched over the next three and a half years. Shares of rival chipmaker Skyworks fell 4.6% on Friday morning, as Broadcom’s announcement seemed to outweigh its own better-than-expected results for its fiscal first quarter.

Wynn Resorts — Wynn Resorts stock fell 4% Friday as confirmed cases of the coronavirus continued to rise. Authorities in Macau, one of the locations where the casino company operates, have cancelled festivities for the Lunar New Year, and China has instituted travel bans for cities near the outbreak of the virus. There are more than 900 confirmed cases of the virus, according to Chinese state media and the United States Center for Disease Control.

Synchrony Financial — Synchrony Financial tanked more than 9% after missing analyst expectations for its fourth-quarter revenue. The company earned $4.029 billion in revenue, while analysts were expecting $4.072 billion, according to Refinitiv. Synchrony’s net interest income fell 7% year-over-year. The company also expects net interest margin between 15.25% and 15.5% for 2020, below estimates of 15.71%.

Disney — Disney stock fell 1.5% Friday after it announced the Shanghai Disney resort will close until further notice as officials try to stop the spread of the coronavirus. The closure comes at what would normally be an exceptionally busy time for the resort, China’s seven-day Lunar New Year holiday.

E-Trade — Investors punished the brokerage Friday afternoon despite better-than-expected earnings results. The equity dropped 2.7% in midday trading as traders focused on a drop in net interest income and higher non-interest expenses.

United Airlines — The airline stock fell more than 4% on Friday as the total number of Wuhan virus cases rose around the world. Pacific revenue as a percent of total company sales were over 10% for United in 2019, meaning that the company is likely more exposed to cancellations in commercial air traffic in the region than other airlines, according to a Bank of America analysis.

CNBC’s Michael Sheetz, Jesse Pound, Pippa Stevens, Maggie Fitzgerald and Fred Imbert contributed reporting.

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S&P 500 falls after second US coronavirus case is confirmed, airline shares dip

The S&P 500 turned negative on Friday, giving back its gains from earlier in the day after the second U.S. case of the deadly coronavirus was confirmed. 

The broad index was down 0.1% after gaining as much as 0.25% to start off the session. The Dow Jones Industrial Average and Nasdaq Composite also traded well off their highs. The 30-stock Dow was up just 28 points, or 0.1%. The Nasdaq also traded 0.1% higher. 

On Friday, the Centers for Disease Control and Prevention said a Chicago resident who traveled to Wuhan — the Chinese city where the coronavirus originated — in December was diagnosed with the sickness. 

Shares of United Airlines and American both fell more than 3%. Las Vegas Sands and Wynn Resorts also dropped more than 2% each. Treasury yields fell, pushing back shares lower. The benchmark 10-year yield traded below 1.7%. JPMorgan Chase, Citigroup and Bank of America all traded more than 1% lower. 

Stocks stared the session on a strong note after the release of better-than-expected earnings from American Express and Intel.

American Express reported a quarterly profit and revenue that beat analyst expectations. Those results were driven in part by strong card fee revenues. The stock gained more than 3%.

Intel, meanwhile, climbed more than 8% after its fourth-quarter numbers topped estimates. The company also gave an optimistic outlook for the first quarter of 2020.

Those results add to what has been a solid start to the earnings season. More than 16% of the S&P 500 has released quarterly results thus far. Of those companies, about 70% have reported better-than-expected earnings, FactSet data shows.

Traders work on the floor of the New York Stock Exchange (NYSE) on January 21, 2020 in New York City.

Spencer Platt | Getty Images

Nick Raich, CEO of The Earnings Scout, pointed out that S&P 500 earnings expectations are also improving, which is “a reason why stocks continue to rise. The rise in price has been more than the underlying improvement in overall EPS expectations. This is what has made stock prices expensive in our opinion.”

Stocks have been on a record-setting tear since last year, with the S&P 500 rising more than 28% in 2019 and gaining more than 2% to start off 2020.

U.S. equities followed their European counterparts higher after IHS Markit data showed business activity in the region showed signs of stabilizing after weakening throughout 2019.

The Stoxx 600 index, which tracks a broad swath of European shares, advanced 1.1%. Germany’s Dax climbed 1.5% while the French CAC 40 gained 1.1%.

“Global economic activity is slowly firming, but is not likely to be sufficiently strong as to unnerve government bond markets over the next few months,” strategists at MRB Partners said in a note. “Nevertheless, the macro backdrop is sufficiently positive, and likely to remain so, to suggest that no worse than a digestion phase or mild correction will be necessary to better align equity prices with the slow-moving uptrend in earnings.”

Stocks have been subdued this week by fears of the China coronavirus spreading, with the death toll rising to 26 and the number of confirmed cases increasing to 830. The S&P 500 and Dow entered Friday’s session on pace for their first weekly loss of the year while the Nasdaq Composite was barely higher week to date.

The virus originated in China, but cases have also been reported in the U.S., Japan, and South Korea. The World Health Organization on Thursday called the outbreak an “emergency in China,” but stopped short of saying it constituted a global public health emergency. This led to a sigh of relief for investors, who were worried the situation had escalated to a global health emergency.

—CNBC’s Ryan Browne contributed to this report.

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10-year Treasury yield falls below 1.7% amid coronavirus fears

The benchmark 10-year Treasury yield hit its lowest level since October on Friday amid increasing fears of the deadly coronavirus.

The yield on the benchmark 10-year Treasury note fell 3 basis points to 1.698%, the first time it dipped below 1.7% since October. The yield on the 30-year Treasury bond was also lower at 2.161%. Bond yields move inversely to prices.

Yields extended their losses Friday after a gauge on U.S. manufacturing sector showed weakness. The first reading of PMIs (Purchasing Managers Index) from IHS Markit for January came in at 51.7. Economists polled by Dow Jones were expecting a manufacturing reading of 52.5.

A reading above 50 shows an expansion in the industry.

Market players continue to monitor the spread of the China coronavirus, as the death toll rose to 25 and the amount of confirmed cases increased to 830. The virus originated in China, but cases have also been reported in the U.S., Japan and South Korea.

The World Health Organization on Thursday called the outbreak an “emergency in China,” but said it didn’t yet constitute a global public health emergency, helping to slightly ease fears over the epidemic.

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S&P 500 turns negative, erases earlier gains

The S&P 500 turned negative on Friday, giving back its gains from earlier in the day as investors wrapped up a choppy week of trading. 

The broad index hovered just below the flatline as losses in the energy, health care and financials sectors offset a 0.7% rise in tech. 

Meanwhile, the Dow Jones Industrial Average traded 80 points higher, or 0.3%, after the release of better-than-expected earnings from American Express and Intel. The Nasdaq Composite also advanced 0.3% and reached a record high.

American Express reported a quarterly profit and revenue that beat analyst expectations. Those results were driven in part by strong card fee revenues. The stock gained more than 3%.

Intel, meanwhile, climbed more than 8% after its fourth-quarter numbers topped estimates. The company also gave an optimistic outlook for the first quarter of 2020.

Those results add to what has been a solid start to the earnings season. More than 16% of the S&P 500 has released quarterly results thus far. Of those companies, about 70% have reported better-than-expected earnings, FactSet data shows.

Traders work on the floor of the New York Stock Exchange (NYSE) on January 21, 2020 in New York City.

Spencer Platt | Getty Images

Nick Raich, CEO of The Earnings Scout, pointed out that S&P 500 earnings expectations are also improving, which is “a reason why stocks continue to rise. The rise in price has been more than the underlying improvement in overall EPS expectations. This is what has made stock prices expensive in our opinion.”

Stocks have been on a record-setting tear since last year, with the S&P 500 rising more than 28% in 2019 and gaining more than 2% to start off 2020.

U.S. equities followed their European counterparts higher after IHS Markit data showed business activity in the region showed signs of stabilizing after weakening throughout 2019.

The Stoxx 600 index, which tracks a broad swath of European shares, advanced 1.1%. Germany’s Dax climbed 1.5% while the French CAC 40 gained 1.1%.

“Global economic activity is slowly firming, but is not likely to be sufficiently strong as to unnerve government bond markets over the next few months,” strategists at MRB Partners said in a note. “Nevertheless, the macro backdrop is sufficiently positive, and likely to remain so, to suggest that no worse than a digestion phase or mild correction will be necessary to better align equity prices with the slow-moving uptrend in earnings.”

Stocks have been subdued this week by fears of the China coronavirus spreading, with the death toll rising to 26 and the number of confirmed cases increasing to 830. The S&P 500 and Dow entered Friday’s session on pace for their first weekly loss of the year while the Nasdaq Composite was barely higher week to date.

The virus originated in China, but cases have also been reported in the U.S., Japan, and South Korea. The World Health Organization on Thursday called the outbreak an “emergency in China,” but stopped short of saying it constituted a global public health emergency. This led to a sigh of relief for investors, who were worried the situation had escalated to a global health emergency.

—CNBC’s Ryan Browne contributed to this report.

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