Early gains were pared back after scientists warned of a rapid increase in coronavirus deaths if the country opened up too fast, plus more in today’s Closing Bell on Money & Markets.
The Top Story
All three major stock market indexes posted strong gains during the morning but gave most of them back by the afternoon.
The easing was due to investor fears surrounding states electing to partially reopen after a coronavirus lockdown stifled the economy.
But with U.S. coronavirus cases topping 1 million, a predictive model often cited by White House officials showed the outbreak could take more than 74,000 U.S. lives by August, compared with an earlier forecast of 67,000, if the lockdowns were lifted too early.
“There seems to be a conflict of opinion about the proper course of action,” said New Vines Capital LLC managing director Andre Bakhos. “As more insights back the belief that opening up early is not the best course of action right now, because if we do and if we get a relapse, then the next wave could even be worse.”
The benchmark S&P 500 also remains 17% away from reclaiming a record high hit in February, and analysts have warned of further declines when and if a deep global recession sets in, which is extremely likely if not already in motion.
Investors also are awaiting the outcome of a two-day Federal Reserve policy meeting Wednesday, although it’s unlikely the central bank will provide any additional easing at this time.
The Dow Jones fell 0.1%. The S&P 500 lost 0.5%, and the Nasdaq Composite fell 1.4% as investors looked to profit ahead of tech-related companies announcing earnings this week.
Stock Market Update: Closing Bell*
S&P 500: 2,863 (-0.5%)
DOW: 24,101 (-0.1%)
NASDAQ: 8,607 (-1.4%)
GOLD: $1,724 (flat)
BITCOIN: $7,733 (+0.3%)
U.S. 10-YEAR YIELD: 0.61% (-0.04)
*- as of 5:05 p.m.
A Big Win
In this morning’s Opening Bell, we told you that Pfizer Inc. (NYSE: PFE) shares jumped in premarket trading. The company beat Wall Street expectations for quarterly earnings. Well, those gains were all given back by the afternoon as Pfizer was down 0.9%.
Southwest Airlines Co. (NYSE: LUV) also had a reversal of fortune after a big premarket drop due to earnings. The company bounced up to a 2% gain in the afternoon session.
One company that held on solid ground during the day was 3M Co. (NYSE: MMM). The company reported stronger Q1 earnings in the morning. Shares of 3M Co. rose 2.6%.
Golden Nuggets
Precious metal prices were mixed, but gold turned downward slightly as short-term futures traders looked to lock in profits.
Gold futures were flat at $1,724.60 an ounce. Silver futures dropped 0.1% to $15.20 an ounce.
Platinum and palladium were both higher. Palladium moved up 0.1% to $1,898, while platinum futures jumped 2.2% to $794.10 an ounce.
Cannabis Corner
Weed and hemp flower vaporizer company Omura raised $5 million with some of the funding coming from former Canopy Growth Corp. (NYSE: CGC) CEO Bruce Linton.
According to Marijuana Business Daily, Linton will be a strategic advisor. The company plans to use the new capital to expand across recreational and medical markets in the U.S. and Canada.
US Consumer Confidence Drops Amid COVID-19 Disruptions
With millions of Americans out of work and the economy in flux, consumer confidence hit a six-year low in April.
The Conference Board said its consumer confidence index dropped to 86.9 — the lowest it’s been since June 2014 when it was 118.8. The report said short-term expectations for the economy and the labor market did improve slightly.
“However, consumers were less optimistic about their financial prospects and this could have repercussions for spending as the recovery takes hold. The uncertainty of the economic effects of COVID-19 will likely cause expectations to fluctuate in the months ahead,” The Conference Board senior director of economic indicators, Lynn Franco, said.
Today’s Big Winners:
Harley-Davidson Inc. (NYSE: HOG) +15.3%
American Airlines Holdings Inc. (Nasdaq: AAL) +12.4%
American Express Co. (NYSE: AXP) +3.7%
Cincinnati Financial Corp. (Nasdaq: CINF) -12.5%
Incyte Corp. (Nasdaq: INCY) -5.2%
Merck & Co. Inc. (NYSE: MRK) -3.4%
Check back for the most important news and numbers each day after the Closing Bell, only on Money & Markets.
