U.S. equities attempted to make up some of their steep weekly losses on Friday but mainly traded around the flat line. Oil continued to rebound from its unprecedented sell-off earlier in the week. Stocks digested more company earnings, which showed the economic ramifications of the coronavirus shutdown. Here’s what is happening.
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12:00 pm: Markets at midday: Stocks little changed to end wild week
Around midday, the major averages hovered around the flat line as investors wrapped up a volatile week amid historic oil moves. The Dow was down 26 points, or 0.1%. The S&P 500 traded 0.1% higher while the Nasdaq advanced 0.2%. Stocks were up sharply earlier in the day, with the Dow gaining 200 to start off the session. —Imbert
11:46 am: US says hedge funds, private equity are not eligible for small business relief loans
The Small Business Administration said Friday that hedge funds and private equity firms are ineligible for the small business relief program. The move comes after reports that hedge funds had applied for the first round of the Paycheck Protection Program. That fed into a public backlash after the program’s initial $350 billion was quickly exhausted and it was revealed that big public companies, rich universities and large restaurant chains had tapped the PPP. “Hedge funds and private equity firms are primarily engaged in investment or speculation, and such businesses are therefore ineligible to receive a PPP loan,” the SBA said in an update posted online. — Son, Rogers
11:37 am: Beyond Meat on track for best week ever
Shares of Beyond Meat jumped 10% Friday, bringing its weekly rally to 43%, on pace for its best week ever back to its IPO on May 2, 2019. The stock is set for its 14th positive day in 15. The plant-based meat company said earlier in the week it will start selling its products in Starbucks stores in China.—Li, Francolla
11:33 am: Zoom shares rise on announcement it will join Nasdaq 100 on April 30
Zoom shares rose 5% Friday morning after the Nasdaq announced the video conferencing company is joining the Nasdaq 100 next week and two days after it reported a surge in active users. When it joins the Nasdaq 100 on April 30, Zoom will also enter the Invesco QQQ Trust, the second-most highly traded ETF in the U.S. Zoom will replace Willis Towers Watson in the index, Nasdaq said. Zoom has been on a tear since stay-at-home mandates were implemented to slow the Covid-19 pandemic. Zoom CEO Eric Yuan announced earlier this week that the company’s number of daily users grew 50% in the past month to 300 million from 200 million. The company reported about 10 million daily users in December. “Clearly the Zoom platform is providing an incredibly valuable service to our global users during this challenging time,” Yuan said. — Bursztynsky
11:32 am: Fed programs put out $86 billion in financing so far
The Federal Reserve’s programs aimed at keeping financial markets running smoothly have injected about $86 billion so far into the system. In a monthly accounting the Fed provided Friday, the Money Market Liquidity Facility has loaned out $51.1 billion, the Primary Dealer Credit Facility has put out $34.5 billion, while the Commercial Paper Funding Facility has loaned $249.2 million. The programs are aimed at troubled parts of the market, providing short-term liquidity for money market mutual funds, large financial institutions that serve as dealers in government bonds, and the commercial paper vehicles that provide unsecured funding that businesses use for operations. The Fed also has launched a host of other facilities aimed at households, small businesses and state and local governments. – Cox
11:30 am: Huge spike in guidance withdrawals
Data compiled by S&P Global Market Intelligence shows 173 companies withdrew their previous guidance in the first quarter amid growing uncertainty due to the coronavirus. “This leaves decision-makers looking for alternative forward-looking information on a company’s prospects,” analyst Eric Oak said in a note. He pointed out metrics such as shipping data can “provide a near real-time view into a firm’s activities.” –Imbert
11:23 am: Stocks fall as oil gives up gains
U.S. oil went negative in mid-morning trading on Friday, weighing on equities. West Texas Intermediate crude pared its gains after being up more than 5% earlier in the day. The Dow Jones Industrial Average fell about 50 points, brought down by a 5% drop in Boeing and a 2% fall in Intel. The S&P 500 was also negative while the Nasdaq stayed in the green. —Fitzgerald
11:06 am: Exxon plans to produce 5 million bottles of hand sanitizer
Exxon said Friday that it has modified its Louisiana manufacturing operations so that it will be able to produce medical-grade hand sanitizer. The oil giant said it was targeting production of 160,000 gallons, which equates to nearly 5 million bottles. Exxon said the sanitizer would be used for coronavirus response efforts in Louisiana, New Jersey, New Mexico, New York, Pennsylvania and Texas. – Stevens
10:33 am: AT&T CEO Stephenson to step down on July 1
AT&T CEO Randall Stephenson announced during a shareholders meeting that he would step down on July 1. Chief operating officer John Stanker will ascend to the top job. Stephenson’s retirement was not unexpected, but he previously said he planned to stay on through at least the end of 2020. Stephenson will stay on as executive chairman until January. Shares of the telecom giant were trading 0.6% higher on Friday morning. — Pound, Feiner
10:15 am: DraftKings rises 14% in its public debut
Sports-betting operator DraftKings began trading on Friday under the ticker DKNG, after merging with a blank check company Diamond Eagle Acquisition. Shares gained 14% to around $20 a piece in Friday’s morning trading. The public debut came even as the sports-betting industry is upended after most sporting events were canceled due to the coronavirus pandemic. Don Bilson, head of events-driven research at Gordon Haskett, called the stock “a way to play sports gambling without the casino risk.” – Li
10:10 am: US consumer sentiment for April falls to 71.8, vs 67 expected
U.S. consumer sentiment fell for a third straight month as people weigh the coronavirus pandemic and the possibility of an economic re-opening, data released Friday by the University of Michigan showed. The consumer sentiment index fell to 71.8 in April from 89.1 in March. Economists polled by Dow Jones expected a print of 67. That decline comes after a sharp drop in current economic conditions. —Imbert
9:55 am: Friday’s biggest analyst calls of the day include eBay, Expedia, Tyson Foods & more
- Stifel upgraded eBay to buy from hold.
- Bernstein downgraded Tyson Foods to market perform from market outperform.
- JMP upgraded Expedia to market outperform from market perform.
- Piper Sandler downgraded Hershey to neutral from overweight.
- Wedbush downgraded Dunkin’ Brands to neutral from outperform.
- Raymond James downgraded The Travelers Companies to underperform from market perform. —Bloom
9:48 am: Rally collapses
Shortly after the opening bell, stocks’ rally lost steam. The Dow Jones Industrial Average was up about 20 points. The S&P 500 and Nasdaq went negative. —Fitzgerald
9:31 am: Stocks open higher, Dow up 150 points
U.S. equities opened Friday in the green, with a gain of 180 points for the Dow Jones Industrial Average. The S&P 500 rose 0.68% and the Nasdaq Composite rose 0.44%. Stocks were helped by a rebound in oil prices after their unprecedented sell-off. — Fitzgerald
9:10 am: Businesses slowed paying their bills in March, but spent a whole lot on technology, data shows
As the economy shut down, businesses diverted spending to technology, while cutting back more broadly on other outlays including their payments to suppliers, according to data tracking business-to-business spending. Even before the state shutdowns took effect in the second half of March, companies had boosted spending on technology. Overall spending slipped 2%, but IT spending doubled in March, after rising by 75% in February, compared to the year earlier, according to data from Cortera. Spending for everything from laptops to software, IT services and cabling was up 100% in March, presumably as companies shifted work from offices to homes and moved more of their own businesses. —Domm
9:00 am: The rally has stalled out
The S&P 500 is down 2.5% this week, gone nowhere for the past two weeks. Bears are arguing the current economic climate is not enough to justify the S&P 500 at the 2,800 level and that the economy is signalling a much bigger slowdown than stocks are pricing in. There is big execution risk around reopening and a secondary wave of infections. —Pisani
8:51 am: Beware of Fridays in 2020
Bespoke Investment Group warned about the last trading day of the week: Friday, which has proved to be the worst trading session of the week, according to data from this year. “For all of 2020, though, Fridays have been the worst day for the market with a median decline of 0.82% and gains barely even 25% of the time,” the firm said. Stocks are pointing to gains at the open, but are down for the week. —Fitzgerald
8:49 am: People’s United jumps 10% on earnings beat
Shares of People’s United Financial soared nearly 11% in premarket trading on Friday after the bank holding company reported better-than-expected quarterly results. People’s United earned 33 cents per share in the first quarter, above analysts’ estimate of 24 cents per share, according to FactSet. The company also reported an operating income of $141 million, a 15% increase from last year. Still, the stock has fallen more than 30% this year amid the coronavirus pandemic. –Li
8:43 am: Jim Cramer picks out ‘Covid winners’ for stock investors
CNBC’s Jim Cramer laid out two buckets of stocks investors can play through the coronavirus pandemic. The first basket of equities that Cramer suggests picking among includes firms that are “big enough and deep pocketed enough” to weather the economic impact, including IBM and Union Pacific. In the second bucket are companies that have been able to adapt, maintain business and benefit from the coronavirus pandemic and efforts to slow the spread of the deadly disease, Cramer said. “If you want to invest right now, you have to own some stocks from the second bucket — the Covid winners — and whenever the market gets slammed, you can buy members of the first bucket, the big businesses with deep pockets,” he said. The second bucket includes Amazon, Walmart, Costco and Target. —Tyler Clifford, Li
8:40 am: U.S. banks are a good bet, Eisman says
Neuberger Berman senior portfolio manager Steve Eisman said on “Fast Money” Thursday night that the large U.S. banks are “the best cyclical play out there.” Eisman, whose bets against the housing market were detailed in the book “The Big Short,” said that he has short positions against Canadian banks. Eisman also said that he was short against Trex, a company in the housing industry that makes decking and outdoor items. — Pound, Imbert
8:30 am: Coronavirus will change media forever, says Moffett Nathanson
Moffett Nathanson said the production and distribution of media content will be permanently changed by the coronavirus crisis, and Disney is the only company that is capable of adapting. “We believe Disney is the only company with a big enough lifeboat and the organizational will to come out of these secular changes in a strong position,” the firm said in a note to clients. As customer behavior permanently shifts to streaming models, Netflix Amazon and Disney will emerge with the lion’s share of scripted content. Moffett Nathanson has a buy rating on Disney and $120 per share price target. The firm said Fox’s focus on live news and sports remains the right strategy. — Fitzgerald
8:26 am: Intel shares fall 5% on low guidance
Shares of Intel sank more than 5% in premarket trading on Friday after giving second quarter guidance below expectations. Intel said it forecasts $1.10 in adjusted earnings per share and $18.50 billion in revenue in the second quarter. Analysts polled by Refinitiv had expected adjusted second-quarter earnings of $1.19 per share on $17.97 billion in revenue.Intel said it would not give guidance for the full year. The company beat on the top and bottom lines of its first quarter earnings. —Fitzgerald
8:12 am: Commodities don’t have ‘luxury’ to price in a recovery
Amid unprecedented demand loss in the commodities market due to the coronavirus pandemic, Goldman Sachs said that before oil can meaningfully rebound demand will have to recover. “While acknowledging that a balanced market is in eyesight, more forward-looking assets like equities can look past the next several weeks and begin to price a recovery; however, commodities simply do not have that luxury,” Goldman’s global head of commodities research Jeffrey Currie said in a note to clients Friday. He said that while the rebalancing period for oil has begun, it will take 4-8 weeks to resolve before “we can comfortably argue a bottom has been carved out.” – Stevens
8:00 am: Tyson downgraded on worries about planet closures
Shares of Tyson Foods fell more than 1% in premarket trading on Friday following a downgrade to market-perform from outperform from AB Bernstein. The Wall Street firm said it has near-term uncertainty around Tyson’s ability to maintain production levels with closed production plants and absent workers. “There could be further downside as it is difficult to contain the spread of the virus in highly labor-intensive meat plants,” AB Bernstein analyst Alexia Howard told clients. Tyson closed its two largest pork plants in Iowa and Indianan this week after employees tested positive for the COVID-19. “While we continue to expect African Swine Fever-led upside over the medium term, we believe that it is prudent to downgrade the stock in the interim,” Howard added. — Fitzgerald
7:51 am: Verizon shares rise after earnings top expectations
Shares of the telecommunications company jumped nearly 1% in premarket trading after posting a quarterly profit that topped Wall Street’s estimates. Verizon reported earnings of $1.26 per share, 3 cents higher than expected, according to Refinitiv. Revenue came in short of expectations. Verizon slashed its full year earnings outlook to a range of -2% to 2% growth, compared to the 2% to 4% range they previously released. —Fitzgerald
7:50 am: Oil extends three-day rally, rises 3%
Oil rose again on Friday, extending recent strength that’s seen it rally more than 40% in the last two days, as traders hope that depressed prices will force additional production cuts. West Texas Intermediate, the U.S. benchmark, rose 2.6%, or 44 cents, to trade at $16.94, while international benchmark Brent crude was 3.1% higher at $21.99. WTI gained 19% in each of the last two sessions as prices rebounded from historic lows. But despite these gains, the contract is still set to post its eighth week of losses in nine. The coronavirus pandemic has led to unprecedented demand loss, and with storage around the world rapidly filling, traders are worried that there might soon be nowhere for oil to go. – Stevens
7:44 am: House passes $484 billion bill to boost small businesses and hospitals, sends it to Trump
The House passed a $484 billion package Thursday to bolster small businesses and hospitals ravaged by the coronavirus crisis and expand testing desperately needed to start the return to normal life. The bill is now being sent to President Donald Trump to be signed into law. Donning face coverings and voting in alphabetical sets to cut the risk of infection, representatives approved the bill easily by a 388-5-1 vote. The law would add more funds to the Paycheck Protection Program, add to the Small Business Administration’s disaster loans and grants, give grants to hospitals and bolster coronavirus testing, a core piece of any plan to restart the U.S. economy. —Pramuk, Fitzgerald
7:38 am: Trump says he may extend coronavirus social distancing guidelines to early summer
President Donald Trump said Thursday that his administration may extend its national social distancing guidelines until early in the summer or later. “We may, and we may go beyond that,” Trump said at a White House press briefing when asked if the federal guidelines would need to be extended at least until the start of summer. “We’re going to have to see where it is,” Trump said. “I think people are going to know just out of common sense. At some point, we won’t have to do that. But until we feel safe, we’re going to be extending.” The federal guidelines, which were first shared in mid-March and had already been extended once, were set to expire at the end of April. — Breuninger, Macias
7:30 am: Stock futures rise as oil rebounds
Dow Jones Industrial Average futures rose in premarket trading, pointed to a gain of about 200 points at the opening bell on Friday. The S&P 500 and Nasdaq were also set to open in the green. Helping equities is the rebound in oil, which hit record lows earlier in the week. The commodity, which has seen an evaporation of demand due to the coronavirus, rose about 5% on Friday morning.
Stocks ended Thursday’s volatile session little changed. The Dow Jones Industrial Average eked out a 0.17% gain, while the S&P 500 closed down about 0.05%. The Nasdaq Composite also fell 0.01%. However, U.S. equities are pointing to losses for the week after a sell-off earlier in the week due to oil’s dismal rout. The Dow is down 3% since Monday, on pace for its first negative week in three. The 500-stock index is down 2.67% this week, heading into Friday’s session. The Nasdaq is down 1.8% this week. — Fitzgerald
— with reporting from CNBC’s Jesse Pound, Fred Imbert, Patti Domm and Michael Bloom.
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