The Dow Jones Industrial Average could slide further Thursday after COVID-19 passed its record for most cases in a single day, hitting 36,358 cases.
Investors are also eyeing an ongoing trade dispute between the United States and China - and a weak U.S. economy. The market is discounting the possibility that the Fed will continue to expand open market operations given the weakness in underlying fundamentals. More on these developments below.
Before we dive into the latest stories and more, here are the numbers from Wednesday for the Dow, S&P 500, and Nasdaq:
Index
Previous Close
Point Change
Percentage Change
Dow Jones
25,445.94
-710.16
-2.72
S&P 500
3,050.33
-80.96
-2.59
Nasdaq
9,909.17
-222.20
-2.19
Now here's a closer look at what I'm following today. These are the most important market events and stocks.
The Top Stock Market Stories for Thursday
On Wednesday, my primary momentum model went negative, implying that selling pressure is mounting from last week's initial downturn before the Fed announced it would start buying corporate bonds. This could last a day; this could last a few weeks. But this is the first time that this momentum measurement has been negative in the markets in about seven weeks (after buying pressure returned in early April). It's an indication that we could see significant sell-offs in the coming days. I anticipate that the Federal Reserve may move to take more aggressive action on providing liquidity or engaging in more open market operations. I am encouraging investors to take recent profits off the board and to bolster their cash positions (or consider inverse ETFs). The situation tells me that the recent COVID-19 spike is pushing the market into a correction.
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Johns Hopkins University reports that the number of U.S. coronavirus cases topped 2.36 million this morning. The number of cases across Florida, California, and Texas continue to rise to record levels as the prospect of renewed stay-at-home orders lingers across the country. Right now, New York, New Jersey, and Connecticut have announced a 14-day quarantine on people traveling from states where COVID-19 cases are on the rise. On Wednesday, the U.S. surpassed its record for the number of cases recorded in one day at 36,358 positive cases. The World Health Organization also said that it reached its largest number of cases ever on Sunday at 183,000.
Gold prices are hovering near a decade-long high as investors flock to safe-haven assets due to COVID-19 and the ongoing concerns about the economy. The International Monetary Fund recently slashed its 2020 economic expectations after it said that the pandemic is now worse than its economists previously expected.
Stock to Watch Today: DIS, KBH, HTZ
Walt Disney Co. (NYSE: DIS) could delay the release of its next live-action film "Mulan," which was scheduled for theatrical release on July 24. The film would have been one of the first major blockbusters to hit theaters since they closed due to COVID-19.
Shares of KB Homes (NYSE: KBH) fell more than 14% after the construction company released second-quarter earnings. The firm reported earnings of $0.55 per share, which topped expectations by $0.06. However, its revenue output of $914 million was well short of the $1.06 billion projected by analysts. The company said that the rising uptick in COVID-19 cases fueled a large rise in cancellations for new properties.
Shares of Hertz Global HoldingsInc. (NYSE: HTZ) rallied more than 7% yesterday after the bankrupt car rental company became a potential takeover target. The company's shares have cratered in recent months due to the economic shutdown tied to COVID-19. However, shares ticked higher yesterday on news that Autonation and Carmax were considering bids to purchase the company.
Look for earnings reports from Darden RestaurantsInc. (NYSE: DRI), McCormick & Co. (NYSE: MKC), Accenture Plc. (NYSE: CAN), Rite Aid Corp. (NYSE: RAD), and FactSet ResearchSystems Inc. (NYSE: FDS).
Six-Figure Payday Opportunity Opens After the FCC Launches $10 Billion Initiative
Working from home, telemedicine, and even online grocery shopping are trends that have been here for years without causing any problems... until February.
The 88 most populous cities across the United States are now seeing their Internet speeds tumble by 44% (and this could just be the start).
That's why the FCC had to step in - and its $10 billion initiative could translate to a huge payout because of it.
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.