The Dow Jones rallied 800 points at open today after a long week of coronavirus-induced volatility. But there could be signs of stabilization ahead...
A slowdown in death rates across Europe has many people hoping the U.S. rate will peak soon. Meanwhile, Japan has unveiled a new stimulus package worth 20% of GDP to help stave off negative economic impacts of the outbreak. More on these events below.
Here are the numbers from Friday for the Dow, S&P 500, and Nasdaq:
Index
Previous Close
Point Change
Percentage Change
Dow Jones
21,052.53
-360.91
-1.69
S&P 500
2,448.65
-38.25
-1.51
Nasdaq
7,373.08
-38.25
-1.51
Now here are what I think will be the most important market events and stocks on Monday morning.
The Top Stock Market Stories for Monday
Oil prices plunged more than 5% on news that OPEC's meeting with Russia has been delayed. Markets had hoped that a deal between the Saudi leaders and Russia would provide a big boost to crude oil. The price had been in a free fall thanks to the ongoing coronavirus demand shock and Russia's refusal to cut daily production by 1.5 million barrels per day. Saudi Arabia responded by tearing up the previous deal and dramatically cutting prices. A meeting is likely to happen later this week, according to Reuters. Ratings agency Fitch said that oil prices could fall into the "single digits" if both sides fail to reach an agreement very soon.
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It was just a few weeks ago that hedge fund manager Bill Ackman warned that "Hell is coming" on the coronavirus. But today, the head of Pershing Square said that the outlook is starting to look brighter. "I am beginning to get optimistic," he wrote Sunday. "Cases appear to be peaking in NY. Almost the entire country is in shut down. Hydroxychloroquine and antibiotics appear to help. There is increasing evidence that the asymptomatic infection rate could be as much as 50x higher than expected."
JPMorgan Chase CEO Jamie Dimon penned his annual letter to shareholders on Monday. Dimon said that the nation's largest bank by assets is prepared for any economic downturn caused by coronavirus. "We have the resources to emerge from this crisis as a stronger country," Dimon wrote. "America is still the most prosperous nation the world has ever seen." Johns Hopkins University reports that the number of confirmed cases topped 1.27 million over the weekend. The number of deaths now sits at 69,300.
Stocks to Watch Today: BA, WFC, AAL, JBLU, UAL
Shares of Boeing Co. (NYSE: BA) are in focus after the company announced plans to extend the shutdown of its production facilities in the Seattle region due to coronavirus. The firm had shuttered its facilities last month and expected it to be temporary. Boeing stock is off more than 60% since the start of the year, far worse than the 26% slump in the Dow.
Wells Fargo & Co. (NYSE: WFC) has announced it will cap its small business rescue program at $10 billion due to regulatory issues. The government program, launched last Friday, will help businesses address fixed costs and payroll for the next eight weeks. Wells Fargo has been under scrutiny from regulators for years due to its financial practices. Regulators have largely been cool on the idea of lifting caps on the bank's assets.
Finally, airports have been slashing flights to the center of American capitalism. Over the weekend, American Airlines Group Inc. (NASDAQ: AAL) joined JetBlue Airways Corp. (NASDAQ: JBLU) and United Airlines Holdings Inc. (NYSE: UAL) in cutting service to airports near New York City. Airline stocks have plunged due to the spread of the coronavirus. More than 120,000 people have tested positive for the disease in the state, with half of those in New York City alone.
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Garrett Baldwin is a globally recognized research economist, financial writer, consultant, and political risk analyst with decades of trading experience and degrees in economics, cybersecurity, and business from Johns Hopkins, Purdue, Indiana University, and Northwestern.