Stock markets cut some losses with a furious last-minute rally Friday after Federal Reserve Chair Jerome Powell says the central bank will act — if necessary — plus more in today’s Closing Bell on Money and Markets.
The Top Story
Powell attempted the calm market nerves Friday when he said the central bank will act if losses continue to mount.
Powell said the U.S. economy remains strong, but the coronavirus outbreak continues to pose a major risk to economic activity.
“The Federal Reserve is closely monitoring developments and their implications for the economic outlook,” Powell said. “We will use our tools and act as appropriate to support the economy.”
His remarks served as a short respite for equities markets, which continued to slide on the last day of the worst week for markets since the Great Recession.
The Dow Jones Industrial Average had lost more than 1,000 points earlier in the day but rallied back to close only 357 points down after Powell’s comments. The benchmark 10-year Treasury yield hit a new low at 1.13% in the afternoon, but managed to scratch back up to 1.16%.
The Dow Jones Industrial Average fell 1.4%. The S&P 500 dropped 0.8% while the Nasdaq Composite managed to close flat at 8,567 points.
It closed off the worst week for major U.S. indexes since October 2008.
Money and Markets: Closing Bell*
S&P 500: 2,954 (-24 points, -0.8%)
DOW: 25,088 (-357 points, -1.4%)
NASDAQ: 8,567 (+0.89 points, +0.01%)
GOLD: $1,582 (-$62, -3.7%)
BITCOIN: $8,666.03 (-$225.18, -2.5%)
U.S. 10-YEAR YIELD: 1.16%
*- as of 4:12 p.m.
A Big Win
In this morning’s Wall Street Wake-Up, we told you to be on the lookout for Beyond Meat Inc. (Nasdaq: BYND). The company posted a quarterly loss in the morning and its shares cratered 15.5%.
Wayfair Inc. (NYSE: W) shares fell more than 10% after the company reported a Q4 loss — deeper than Wall Street projections. Its losses were $3.54 per share.
Shares of Trade Desk Inc. (Nasdaq: TTD) jumped 14.9% on the news it beat analysts’ expectations for quarterly earnings and sales. The company also provided strong sales guidance for Q1 and 2020.
M&A News
Accenture (NYSE: ACN) has completed its acquisition of U.K. data consultant Mudano. Terms of the transaction were not disclosed.
Westrock Coffee Co. LLC wrapped up its acquisition of S&P Coffee & Tea from Cott Corp. (NYSE: COT). The transaction is valued at $405 million. Westrock employs more than 1,700 people around the world.
Golden Nuggets
It seems a bit out of the ordinary, but safe havens joined equities in another day of bloodletting Friday.
Normally when equities suffer a letdown, as they have in the last week, precious metals like gold, reap the benefits. However, that was not the case as markets closed out a week of significant losses.
Gold futures, despite staying on track for the third month of gains, dropped nearly 4% in the afternoon to fall below $1,600 an ounce.
Silver futures followed suit — dropping 6.3% to $16.54 an ounce. Platinum suffered another day of losses as it tumbled 4.4% to $865.15 an ounce. Palladium, which has been relatively steady in the last two weeks, also suffered a drop to $2,500 an ounce.
Cannabis Corner
In a public speech, Food and Drug Administration Commissioner Stephen Hahn said it would be “a fool’s game” to pull CBD products off the market.
“People are using these products,” Hahn, a cancer doctor, said in his first public speech on CBD since taking office as commissioner in December. “We’re not going to be able to say you can’t use these products. It’s a fool’s game to try to even approach that.”
While hemp and its derivatives have been legal in the United States since the 2018 Farm Bill, rules surrounding the marketing of those products have been at issue.
Hahn suggested the FDA isn’t looking to seriously crackdown on the entire industry.
Stock Market Update
Apple Inc. (Nasdaq: AAPL) CEO Tim Cook told Fox Business the company is keeping a close eye on the pace of the coronavirus in South Korea and Italy.
Apple uses Korea-based Samsung Electronics Co. Ltd. and LG Electronics as suppliers for its various products.
Cook also said that the company was in “phase three of the ramp mode” to get back to normal operations.
Shares of Apple bounced up briefly in the afternoon, briefly falling into bear market territory. It hit an all-time high of $327.85 per share on Jan. 29 but fell to around $273 on Friday.
Last week, Apple said it would not meet its guidance for the first quarter due to the coronavirus and its impact on product demand, particularly in China.
Today’s Big Winners:
Cimarex Energy Co. (NYSE: XEC) +7.8%
Norwegian Cruise Lines Holdings Ltd. (NYSE: NCLH) +7.2%
Live Nation Entertainment Inc. (NYSE: LYV) +5.2%
Nvidia Corp. (Nasdaq: NVDA) +6.9%
Xilinx Inc. (Nasdaq: XLNX) +5%
Today’s Big Losers:
AES Corp. (NYSE: AES) -8.5%
Mylan NV (Nasdaq: MYL) -7.9%
L Brands Inc. (NYSE: LB) -6%
American Airlines Group Inc. (Nasdaq: AAL) -7.5%
JPMorgan Chase & Co. (NYSE: JPM) -4.4%
Check back for the most important news and numbers each day after the Closing Bell, only on Money and Markets.
Don’t forget about “Marijuana Markets: a POTcast,” featuring the biggest cannabis news and investment notes from Banyan Hill’s Anthony Planas, here on Money and Markets each Saturday morning.