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The Dow Jones Industrial Average is volatile this morning as concerns of a potential second wave of coronavirus cases abound.
Shares of tech stocks like Apple Inc. (NASDAQ: AAPL) and Microsoft Corp. (NASDAQ: MSFT) were up, while companies most likely impacted by the threat of COVID-19 – sectors like airlines and hotels – slid.
Here are the numbers from Friday for the Dow, S&P 500, and Nasdaq:
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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
- On the coronavirus front, the number of cases in the United States keeps climbing. Johns Hopkins University confirms that the number of new cases topped 30,000 last Friday. That was the highest tally since May 1. We are now seeing new records in states like California, Arizona, Florida, and Nevada. The uptick in new cases has forced Apple Inc. (NASDAQ: AAPL) to close some of its retail locations again and for cruise operators to suspend all trips until mid-September.
- Oil prices dipped slightly this morning. Concerns about COVID-19 countered reports of tighter supplies and production around the globe. In the United States and Canada, the number of operating rigs for oil and gas production fell to a record low last week. Even with prices of WTI crude pushing back to $40 per barrel, some producers are concerned about the state of the economy and fear of a pullback in prices. In addition, Deloitte noted that the U.S. shale industry could take a $300 billion hit due to coronavirus. A new study suggested that companies are facing a period where oil prices will struggle to reach breakeven levels in the second quarter.
- Gold prices are back at a seven-year high with the dollar falling against a basket of other currencies. With the U.S. Federal Reserve pumping unprecedented amounts of liquidity into the economy, concerns are rising about the dollar's status as a safe-haven asset. On Friday, two prominent members of the Federal Reserve warned that the U.S. unemployment rate could surge again, should we see a continued uptick in COVID cases. The combination of concerns about unemployment and inflation are weighing on the dollar and making gold an attractive asset for investors.
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Stocks to Watch Today: AAL, SPCE, TSN
- Shares of American Airlines Group Inc. (NASDAQ: AAL) were off 7% on news that the airline was seeking new financing in the face of COVID-19. The news also dragged down shares of rivals like United Airlines (NYSE: UAL). The company said that it plans to raise at least $3.5 billion in new financing to bolster its liquidity as it struggles to address slumping demand in air travel. United also generated some headlines this morning on news that it might launch a $5 billion debt sale later this week.
- Shares of Virgin Galactic Holdings Inc. (NASDAQ: SPCE) popped 15% after the company announced it has signed a deal with NASA. Under the terms of the contract, the company will help recruit and trade private astronauts that want to visit the International Space Station.
- Shares of Tyson Foods Inc. (NYSE: TSN) are under pressure after China suspended imports of chicken from its Springdale, Ark., plant. The Chinese government said that it was taking action due to the rising number of COVID-19 infections at the plant. Tyson said it is currently looking into the matter and said that it is hopeful that it can resolve the issue in the coming days.
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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.