Stocks slump as coronavirus mushrooms outside of China
U.S. equity markets opened lower as the coronavirus' spread outside of China accelerated.
The early selling had the major averages on track for their first weekly loss in three.
Global markets received an overnight scare after South Korea reported 52 new cases of the coronavirus, raising the country’s total to 156, most of which have occurred since Wednesday. South Korea’s Kospi tumbled 1.5 percent on the news while Hong Kong’s Hang Seng shed 1.1 percent and Japan’s Nikkei slid 0.4 percent.
Meanwhile, the latest figures out of China showed the number of new cases continued to slow. The National Health Commission said there were 889 new coronavirus cases and 118 deaths in the country in the 24 hours through Thursday, raising the totals to 75,465 and 2,236, respectively. China’s Shanghai Composite outperformed, adding 0.3 percent.
CORONAVIRUS SPREAD THREATENS STOCK MARKET'S IMMUNITY
Coca-Cola was the latest U.S. company to warn the coronavirus outbreak would ding its quarterly results. The soft-drink giant expects a 1- to 2-cent earnings per share hit to first-quarter earnings, but maintained its full-year guidance.
On the earnings front, Deere & Co. reported better-than-expected fiscal first-quarter results and said it was seeing a stabilization in the U.S. farm industry, which has been ravaged by the trade war with China.
Elsewhere, Sprint and T-Mobile amended the terms of their merger, reducing the size of the stake held by Japanese telecom giant SoftBank while raising Deutsche Telecom’s ownership.
HP adopted a poison pill in an attempt to fight off Xerox’s takeover attempt. The company’s board of directors adopted a shareholder rights plan that gives shareholders the right to purchase stock at a discount if a person or group acquires 20 percent or more of HP’s common shares.
Meanwhile, Wells Fargo shares garnered fresh attention after The New York Times reported the bank is nearing a settlement with the U.S. Securities and Exchange Commission over abuses in its banking and lending practices.
Commodities trading was mixed, with gold up 1.5 percent at a seven-year high of $1,645 an ounce and West Texas Intermediate crude oil down 1.4 percent, at $53.12 a barrel.
U.S. Treasurys rallied, pushing the yield on the 10-year note down 4.2 basis points to 1.483 percent, its lowest since September.
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European markets recouped the majority of their early losses. France’s CAC and Germany’s DAX were both little changed while Britain’s FTSE was down 0.3 percent.
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