Market volatility continues to be the name of the game as stock futures plummeted to limit-down levels once again, while Treasury yields rocketed up Wednesday morning, plus stocks to watch today in the Money & Markets Opening Bell.
The Top Story
Markets aren’t ready to settle down yet as futures once again sank at least 5% at one point to trigger another limit down halt to prevent them from going any lower.
The U.S. government is considering a $1 trillion stimulus package as the coronavirus outbreak rocks the economy and forces many businesses to temporarily close, while people are choosing to self-quarantine and stay home.
The government’s stimulus announcement sent Treasury yields surging up to 1.12% around 7 a.m. Wednesday morning, which is a 35-point jump from the 0.77% it was trading at before Tuesday’s stimulus announcement.
Dow Jones Industrial Average futures were down around 1,000 points earlier Wednesday morning. By 8:02 a.m. EDT the Dow was trading down 1,031 points, or 4.9%. S&P 500 futures were down 4.8% and Nasdaq futures were trading 5.2% lower.
Monday’s recovery was nice to see, but it seems like markets haven’t settled down from recent volatility. The CBOE Volatility Index (VIX) closed at 75.9 Tuesday afternoon, which was just off its record-high 82.9 close Monday.
Stocks to Watch Today
FedEx (NYSE: FDX) — The shipping company reported quarterly earnings Wednesday, matching estimates at $1.41 per share. The COVID-19 outbreak also caused the company to suspend its 2020 profit outlook. Shares were trading 3.6% down before the opening bell.
Target Corp. (NYSE: TGT) — The retailer is reducing store hours to allow for time to restock and clean amid the coronavirus. Shares were down 4.4% premarket.
Cinemark Holdings Inc. (NYSE: CNK) — The movie theater company announced it would be closing all 345 of its U.S. locations because of the virus. Shares fell 31.2% Tuesday, and were down 3.7% premarket.
News You Can Use
Oil prices continued to crater as U.S. crude futures hit a 17-year low $25.06 earlier Wednesday morning. Less travel and lockdowns because of COVID-19 are part of the cause.
“The oil demand collapse from the spreading coronavirus looks increasingly sharp,” Goldman Sachs said in a note, according to Reuters. The bank thinks Brent crude could go as low as $20 in the second quarter, which hasn’t happened since 2002.
Mnuchin Tells Senators US Unemployment Could Hit 20%
While trying to push the $1 trillion coronavirus stimulus package through the Senate, U.S. Treasury Secretary Steven Mnuchin told senators Tuesday that the country’s unemployment rate could hit 20% if they failed to act, according to someone familiar with the meeting’s proceedings.
“During the meeting with Senate Republicans today, Secretary Mnuchin used several mathematical examples for illustrative purposes, but he never implied this would be the case,” Treasury spokeswoman Monica Crowley wrote in an email to CNBC.
ECB Says It’s Ready to Do Whatever It Takes
European Central Bank board member Isabel Schnabel said the ECB is ready to do anything it can to calm tumultuous markets.
“The ECB is ready to do everything in its mandate to counter market turmoil that disrupts monetary policy transmission, otherwise monetary policy cannot function,” Schnabel told German newspaper Die Zeit, according to Reuters.
Wednesday’s response came after Italy’s bond market suffered its worst sell-off since the country’s 2011 debt crisis.
What We’re Reading
Retail Stocks Battered by Coronavirus (Money & Markets)
3 Strategies to Retire on Social Security Alone (Money & Markets)
Could Coronavirus Lead to a Depression? (Barron’s)
Here are the companies releasing earnings reports today:
ACM Research Inc. (Nasdaq: ACMR)
Five Below Inc. (Nasdaq: FIVE)
General Mills Inc. (NYSE: GIS)
Trip.com Group Ltd. (Nasdaq: TCOM)
Williams-Sonoma Inc. (NYSE: WSM)
Check back each morning before the opening bell for stocks to watch today with Opening Bell, here on Money & Markets.