Stocks Rebound to End Higher as Coronavirus Outbreak Declared Public Health Emergency

  1. Stocks turned higher in the final minutes of trading Thursday despite heavy losses in Asia as the death toll from the coronavirus in China rose.
  2. Microsoft reported fiscal second-quarter earnings that topped analysts’ estimates and and revenue from its commercial cloud unit Azure soared 62%.
  3. Tesla is Real Money’s Stock of the Day. The electric vehicle company blasted past fourth-quarter earnings estimates and said it would “comfortably” deliver more than half a million cars in 2020.

Stocks turned higher in the final minutes Thursday as the death toll from the coronavirus in China rose and the World Health Organization declared the virus outbreak “a public health emergency of international concern” but praised the Chinese government’s response to the outbreak.

The Dow Jones Industrial Average ended up 125 points, or 0.43%, to 28,859, the S&P 500 was up 0.31% and the Nasdaq rose 0.26%.

Leading the Dow were Coca-Cola KO, Microsoft MSFT, and Goldman Sachs GS.

WHO Director-General Tedros Ghebreyesus praised China for trying to stem the spread of the virus.

WHO defines a public health emergency of international concern as “an extraordinary event” that constitutes a “public health risk to other States through the international spread of disease” and “to potentially require a coordinated international response.” Previous emergencies have included Ebola, Zika and H1N1.

The declaration allows WHO to put travel advisories in place for cities, regions and countries. WHO also has the ability to review public health measures carried out by countries to ensure they are up to the proper health standards.

WHO’s recommendations are not enforceable, member states are bound by WHO’s 2005 International Health Regulations.

The Centers for Disease Control and Prevention said Thursday that the first case of person-to-person spread of the coronavirus was found in Illinois. Six cases of the virus have been confirmed in the United States, with two in Illinois.

The death toll from the virus has risen to 171, with more than 8,200 people in China and elsewhere confirmed infected. India reported its first confirmed case of coronavirus.

With economists altering forecasts for China’s GDP sharply downwards, and some markets in the Asia region returning to trading following the Lunar New Year holiday, global stocks were back in the red and shrugging off a series of stronger-than-expected quarterly earnings from the biggest American tech companies. Stocks in Taiwan on Thursday slumped more than 5%.

Federal Reserve Chairman Jerome Powell also cited the coronavirus risk when he explained Wednesday that the central bank was still monitoring “increasing uncertainties” in the global economy and risks to growth from the virus. The Fed opted to leave benchmark interest rates unchanged, as expected, at its meeting Wednesday.

Gross domestic product in the fourth quarter rose 2.1%, matching economists’ forecasts. For 2019, growth for the U.S. economy increased 2.3%, below a 2.9% increase in 2018 and a 2.4% rise in 2017.

Microsoft reported fiscal second-quarter earnings that topped analysts’ estimates and the stock jumped Thursday as revenue from its commercial cloud unit Azure soared 62%.

Tesla soared after the electric vehicle company blasted past fourth-quarter earnings estimates and said it would “comfortably” deliver more than half a million cars in 2020.

Coca-Cola’s adjusted earnings in the fourth quarter of 44 cents a share met Wall Street forecasts but revenue came in higher than forecasts as demand for its newer drinks, including Coke Zero and Coca-Cola Plus Coffee, offset headwinds from a stronger U.S. dollar.

Verizon Communications reported fourth-quarter adjusted earnings of $1.13 a share, missing analysts’ estimates by 1 cent. The company added more mobile phone subscribers as it offered the new streaming package launched last year by Walt Disney.

Altria said it was taking a second multi-billion-dollar charge on its investment in Juul Labs and is scaling back the services it provided the company amid ongoing regulatory and medical scrutiny of the e-cigarette market.

Facebook fell sharply Thursday despite reporting solid fourth-quarter earnings and revenue as expenses rose. and Visa report earnings after the closing bell Thursday.

You might also like More from author

Leave A Reply

Your email address will not be published.