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The Dow Jones may correct slightly today as oil prices rebound from their historic collapse to negative territory. A round of earnings reports could also provide a little spark.
But the impact of the coronavirus continues to weigh heavy on the U.S. economy. Here's everything moving the Dow Jones today.
First, here are the numbers from Tuesday for the Dow, S&P 500, and Nasdaq:
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Now, here's a closer look at today's most important market events and stocks. We'll also discuss the stories that slipped under the radar of the mainstream financial press on Wednesday.
The Top Stock Market Stories for Wednesday
- This morning, oil prices stabilized after a tumultuous two days that saw the May WTI contract shoot into negative territory for the first time in history. Producers and contract holders effectively had to pay traders to take their crude off their hands at the delivery point in Cushing, Okla., by the end of the month. Crude prices stabilized following the suspension of the world's largest oil ETF, the U.S. Oil Fund LP (NYSEArca: USO). That fund owned roughly 25% of all May contracts and was rolling over into June. Given that the fund doesn't really have the capacity to take delivery – it has proven the dangers of its strategy during a demand shock. Today, the WTI June contract sat at $11.28 per barrel, while Brent crude traded at $19.35.
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- The U.S. Senate passed another coronavirus bill to provide aid for small businesses, hospitals, and capital for testing. The tab: $484 billion. The House of Representatives will now take up the bill and probably spend a few days filling it with pet projects and more pork items. Roughly $310 billion has been allocated for SMB loans for the Paycheck Protection Program, which already dried up last week. Across the United States, the number of official COVID-19 cases surpassed 825,300, while the number of deaths hit 45,000, according to Johns Hopkins University.
- Finally, the World Meteorology Organization projects that the coronavirus pandemic will drive down global carbon emissions by a staggering 6% this year. That is the largest single yearly decline since World War II. "This crisis has had an impact on the emissions of greenhouse gases," WMO Secretary-General Petteri Taalas said during a briefing in Geneva, Switzerland. "We estimate that there is going to be a 6% drop in carbon emissions this year because of the lack of emissions from transportation and industrial energy production." This will likely become a big topic of discussion among ESG proponents at a time that the carbon energy industry struggles.
Stocks to Watch Today: EXPE, DAL, DGX, NFLX
- Private equity firms Apollo Global Management and Silver Lake Partners are looking at a stake in Expedia Group Inc. (NASDAQ: EXPE). The company has struggled in the wake of COVID-19 as travel bookings have plunged around the globe. According to reports, a deal would be in the range of about $1 billion and set up the PE shops for a big win when travel demand rebounds.
- Shares of Delta Air Lines Inc. (NYSE: DAL) added 2.2% after the company reported earnings this morning. The firm reported a quarterly loss of $0.51 during Q1, a figure that beat expectations of a $0.70 loss. Revenue was also off nearly 18% from the same period in 2019. The firm said that it is conserving cash in the face of a huge downturn in daily flights. It also said that it will likely receive financial support from Congress.
- Quest Diagnostics Inc. (NYSE: DGX) added 2.6% after the company beat quarterly estimates before the bell. The firm reported earnings per share of $0.94, which beat expectations by $0.05, and revenue passed expectations. The firm also announced that it would start testing for COVID-19 antibodies at its labs. The firm is using tests created by Abbott Laboratories (NYSE: ABT).
- Finally, shares of Netflix Inc. (NASDAQ: NFLX) fell 1.8% after the company fell short of earnings expectations. The company did increase its subscriber base by 16 million people during the first quarter. That is roughly double what the company had expected. The firm reported earnings per share of $1.57, which missed consensus expectations by $0.08.
- Look for other earnings expectations this morning from firms like Chipotle Mexican Grill Inc. (NYSE: CMG), Texas Instruments Inc. (NYSE: TXN), and Snap Inc. (NASDAQ: SNAP).
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About the Author
Garrett Baldwin is a globally recognized research economist, financial writer, and consultant with degrees from Northwestern, Johns Hopkins, Purdue, and Indiana University. He is a seasoned financial and political risk analyst, with a focus on stocks, hedge funds, private equity, blockchain, and housing policy. He has conducted risk assessment projects for clients in 27 countries, and consulted on policy and financial operations for some of the nation's largest financial institutions, including a $1.5 trillion credit fund, a $43 billion credit and auto loan giant, as well as two of the largest Wall Street banks by assets under management.
Garrett joined Money Map Press as an economist and researcher in 2011, specializing in alternative strategies with an emphasis on fundamental and technical analysis.