Futures tumble, scary China economic data, traders search for bottom

Futures tumble, scary China economic data, traders search for bottom

Traders work on the floor at the New York Stock Exchange (NYSE) in New York, U.S., February 27, 2020.

Brendan McDermid | Reuters

We are getting ready for another crazy week for the markets with a special live blog of the Sunday night market news. Overnight futures started trading. Check back here for live updates.

8:06 pm: Dow futures stabilize, down more than 200 points

U.S. stock futures had stabilized about two hours after opening on Sunday night, but still pointed to more pain ahead for investors. Dow futures were down more than 200 points while S&P 500 and Nasdaq futures had lost about 1% each. Dow futures briefly dropped more than 500 points shortly after the open. —Imbert

7:30 pm: 10-year yield hits another record low

The 10-year Treasury yield fell to a fresh record low of 1.105% as coronavirus fears continue to send investors scrambling for safety. The benchmark rate, which moves inversely with prices, tumbled about 37 basis points in February alone. The 2-year yield dipped to 0.825%, its lowest level since Nov. 2016, while the 5-year rate fell to 0.873%, the lowest since May 2013.—Li, Francolla

7:18 pm WTI turns positive after brief drop

U.S. oil futures were up about 0.3% at $44.89 per barrel after opening down more than 1%. West Texas Intermediate futures briefly hit their lowest level since Dec. 26, 2018, when it traded as low as $42.52 per barrel. —Imbert, Francolla

7:15 pm: On the Federal Reserve’s power in this precarious situation

Jefferies’ David Zervos with an interesting comment over the weekend in a note on the bazooka that central banks can wield at times like these: “Those who underestimate the power of monetary policy when it comes to combating negative economic shocks finds themselves regretting it.”– Melloy

7:08 pm: Nikkei opens down more than 1%

Japanese stocks opened sharply lower. The Nikkei 225 dropped nearly 1.4% to trade at 20,849.79. —Francolla

6:49 pm: Futures down but still holding Friday’s low

Dow futures were down about 300 points on Sunday night, but held the line above Friday’s low, potentially indicating an area of support for the market. —Imbert

6:40 pm: Stocks in Asia set to open lower

Nikkei futures indicated a decline of over 180 points, or about 1%, when the Japaneses market opens. Stock futures in Australia and New Zealand also fell at the open. —Francolla

6:29 pm: Dollar continues its slide

The Dollar index is down 0.28%, hitting a low so far of 97.846, its lowest level since Feb.4. The greenback reached a fresh low of 106.97 against the yen, its lowest level since Oct.9. —Francolla

6:22 pm: Nearly all stocks in the S&P 500 are in correction or worse

Of the 505 stocks that make up the S&P 500, 487 will enter Monday’s session in correction territory or worse, down at least 10% from their 52-week highs. Deere, Amazon and Walmart are among those stocks in a correction. Also, 201 S&P 500 stocks are in a bear market, down at least 20% from their 52-week highs, including Carnival Corp, Macy’s and Delta Air Lines. Within the Dow, all 30 stocks are down at least 10% from their 52-week highs. Exxon Mobil and Boeing are among the stocks in bear-market territory. —Imbert, Francolla

6:18 pm: WTI breaks below $45 a barrel

Oil futures extended their steep losses, with the U.S. West Texas Intermediate crude falling below $45 a barrel, as fears of the coronavirus outbreak and what it could mean for crude demand continue to batter prices. International benchmark Brent crude fell to $48.90 per barrel, its lowest level since Dec. 2018.— Li

6:16 pm: Bond yields will plumb new lows on Monday

6:04 pm: Dow futures down 400 points

Futures on the Dow Jones Industrial Average fell about 400 points shortly after the start of overnight trading. The S&P 500 futures traded 1.6% lower. The decline in stock futures followed the major averages’ worst week since the financial crisis as the coronavirus worries caused investors to dump risk assets. To be sure, sometimes futures at this early stage can trade in extremes and not fully indicate how the full-day Monday will unfold.— Li

5:41 pm: Chart analyst: Friday’s low is the new line in the sand

On Friday, stocks rapidly pared losses in the last 15 minutes of trading, which serves as the first evidence of “downside exhaustion,” according to Rich Ross, Evercore ISI’s technical analyst. Therefore, investors should use the S&P 500’s intraday low on Friday — 2,853 — as the “new line in the sand,” Ross said. Below that level, there are only two levels of support of note at 2,722 (-7%) and 2,632 (-10%), he added.— Li

5:26 pm: Possible bullish catalyst: Joe Biden wins in South Carolina

One potentially bullish catalyst for stocks is former Vice President Joe Biden winning the South Carolina primary on Saturday. Biden’s victory may be seen as a positive by market participants given his more moderate stance on a number of issues, including health care. Billionaire investors such as Leon Cooperman and Jeffrey Gundlach have warned recently of a stock-market crash if far-left Democratic candidate Sen. Bernie Sanders — who had won the previous two primaries — becomes the next president. —Imbert

5:24 pm: Tony Dwyer: The worst of volatility is behind us

The Cboe Volatility Index, known as the market’s “fear gauge,” surged to above 49 last week, its highest level since 2018. And by one measure, the gauge reached a level unseen since late 2008. According to Tony Dwyer, Canaccord Genuity’s market strategist, the 10-week rate-of-change (ROC) on the VIX hit a level only seen in the height of the financial crisis. “Such extreme volatility spikes don’t mean the exact low price is in, but it does suggest the worst of volatility should be behind us,” Dwyer said.— Li

5:16 pm: Japanese yen rises in early risk-off sentiment indication

The Japanese yen rose 0.3% to 107.65 per U.S. dollar, an early indication that the risk-off sentiment that sent equity markets tumbling remains after a weekend full of negative coronavirus-related news. The yen is often seen as a safe-haven currency by traders.—Imbert

5:02 pm: Big banks: There hasn’t been enough pain to call a bottom yet

Strategists at JPMorgan, Citi and Goldman Sachs all think stock prices need to go down further before a bottom can be called. JPMorgan’s Nikolaos Panigirtzoglou said: “Looking at a range of indicators, we do not yet find the same degree of capitulation as in December 2018.” Tobias Levkovich of Citi Panigirtzoglou comments, noting: “The S&P 500′s drop has improved the risk/reward ratio but we need to see panic readings before stepping up.” Christian Mueller-Glissmann, equity strategist at Goldman Sachs, cautioned against buying this dip, saying “it might be more risky this time.” —Imbert

4:51 pm: Macau’s gambling revenues tumble nearly 90% due to coronavirus

Gambling revenue in Macau plunged 87.8% in February year-over-year as the coronavirus outbreak forced major casinos to close their doors. The government ordered Macau’s 41 casinos to shut down for half a month as the city battled the deadly disease. Casino stocks including Wynn Resorts and Las Vegas Sands are taking the hardest hits from the epidemic, down 14% and 11%, respectively, in February.— Li

4:37 pm: Will global central banks react to the coronavirus?

While the worsening coronavirus continued to rattle the financial markets around the world, expectations are rising on Wall Street that global central banks will come to the rescue by potentially easing their monetary policies. Former Fed Governor Kevin Warsh said last week he sees coordinated action soon in response to the coronavirus spread, and said he recommended the Fed act as quickly as Sunday before the markets reopen. Fed Chairman Jerome Powell said on Friday the central bank is monitoring the coronavirus and pledged action if necessary. However, investors are still waiting for the Fed to pull the trigger and make further announcement. The market is already pricing in a 100% chance of at least one rate cut at the Fed’s March policy meeting. Expectations are that other central banks like Bank of Japan and the ECB will act soon with some sort of relief.— Li

4:16 pm: Top economist Ed Hyman sees zero US growth the next two quarters due to coronavirus

Ed Hyman, a widely followed economist on Wall Street, said the coronavirus outbreak could end up causing a recession in the U.S. and slashed his U.S. GDP forecast to zero growth in the second and third quarters of this year. “More cases are showing up in the U.S. and seem likely to be just the start,” Hyman said in his note titled, “U.S. Virus ‘Recession'” on Sunday. “Scope, severity, and duration are uncertain. How much it changes behavior in the U.S. is uncertain.” Hyman has been ranked the top economist in Institutional Investor’s annual poll for more than three decades. His call is one of the most pessimistic on Wall Street as many only see a temporary slowdown.— Li

4:06 pm: Shockingly bad China economic data

China’s official Purchasing Managers’ Index (PMI), a gauge for its manufacturing sector, plunged to a record low of just 35.7 in February from 50.0 in January, the National Bureau of Statistics said on Saturday. Any reading below 50 signals a contraction. The somber reading provides the first official snapshot of the state of the Chinese economy since the outbreak of the coronavirus epidemic which has killed almost 3,000 people in mainland China and infected about 80,000.— Li

4:02 pm: Coronavirus latest: Cases total more than 85,000; Rhode Island confirms first east coast case

More than 85,000 coronavirus cases have been confirmed worldwide along with at least 2,943 deaths related to the virus. The U.S. confirmed its first virus-related death. The state of Rhode Island reported the first coronavirus case in the east coast of the U.S. Coronavirus cases in Italy surged this weekend to more than 1,100 cases while Iran has confirmed more than 900 cases. A surge in coronavirus cases outside of China sent global stock markets tumbling as investors fretted over a possible economic slowdown. —Imbert

3:54 pm: Awaiting futures open at 6 pm ET

All eyes are on how U.S. stock futures will be trading in a couple of hours following a historic pullback. More than $3 trillion was erased from American stocks in the span of five days last week as the deadly coronavirus stoked fears of a recession, driving investors out of risk assets rapidly. The S&P 500, which tumbled more than 11% last week, also suffered its fastest correction in history— Li

CNBC’s John Melloy and Gina Francolla contributed reporting.

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