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Stock market closes lower on virus news, Boeing weakness
21-Jan-20 16:15 ET
Dow -152.06 at 29195.95, Nasdaq -18.14 at 9370.83, S&P -8.83 at 3320.79

https://www.briefing.com/stock-market-update

[BRIEFING.COM] The S&P 500 declined 0.3% on Tuesday, as headlines about the coronavirus outbreak helped provide a convenient excuse to take some profits, while a delay in Boeing's (BA 313.37, -10.78, -3.3%) 737 MAX timeline to mid-2020 further pressured the Dow Jones Industrial Average (-0.5%). The Nasdaq Composite lost 0.2%, and the Russell 2000 lost 0.8%.

Asian equities were hit the hardest on Tuesday, as the outbreak originated in China, while the initial selling in the U.S. stock market was modest. The virus, which can be transmitted between people and has no current vaccine, fostered a narrative that economic activity could be slowed down by people deciding to refrain from public spheres like travel and shopping.

Investors didn't appear too concerned about the outbreak, though, as the S&P 500 erased its losses, and the Nasdaq hit an intraday high, by the afternoon. The market, however, did reverse course on news of the first reported case of the coronavirus in the U.S., presumably feeding into the slower growth narrative that pulled the market from overbought territory.

Cyclical sectors were among today's laggards, particularly the S&P 500 energy (-1.9%), materials (-1.1%), and industrials (-1.1%) sectors. The latter was weighed by the disappointment in top-weighted Boeing. The rate-sensitive real estate (+1.1%) and utilities (+0.8%) sectors outperformed, as demand for Treasuries drove yields lower.

The 2-yr yield fell four basis points to 1.52%, and the 10-yr yield fell seven basis points to 1.77%. The U.S. Dollar Index finished flat at 97.58. WTI crude declined 0.5%, $0.30, to $58.25/bbl.

Other notable areas included the Dow Jones Transportation Average, which fell 1.8% amid weakness in the airline stocks, and the iShares U.S. Home Construction ETF (ITB 47.80, +0.60), which rose 1.3% on the idea that the lower Treasury yields will drive mortgage rates lower.

Separately, Tesla (TSLA 547.20, +36.70, +7.2%), Costco (COST 313.26, +8.58, +2.8%), Visa (V 207.29, +2.59, +1.3%), and Intel (INTC 60.55, +0.95, +1.6%) benefited from positive-minded analyst recommendations. Uber (UBER 37.60, +2.47, +7.0%) hit a five-month high after the company sold its food delivery business in India.

Investors did not receive any economic data on Tuesday. Looking ahead, investors will receive Existing Home Sales for December, the FHFA Housing Price index for January, and the weekly MBA Mortgage Applications Index on Wednesday.

Nasdaq Composite +4.4% YTD
S&P 500 +2.8% YTD
Dow Jones Industrial Average +2.3% YTD
Russell 2000 +1.0% YTD

Market Snapshot
Dow 29195.95 -152.06 (-0.52%)
Nasdaq 9370.83 -18.14 (-0.19%)
SP 500 3320.79 -8.83 (-0.27%)
10-yr Note +5/32 1.770
NYSE Adv 1152 Dec 1743 Vol 1.1 bln
Nasdaq Adv 1235 Dec 1974 Vol 2.5 bln

Industry Watch
Strong: Real Estate, Utilities, Consumer Staples
Weak: Materials, Energy, Industrials

Moving the Market

-- Stock market closes lower on coronavirus outbreak headlines, Boeing (BA) weakness

-- Narrative that coronavirus will slow down economic activity; relative weakness in the transportation space

-- Boeing said it isn't expecting to get regulatory approval for 737 MAX until mid-2020

WTI crude posts modest loss
21-Jan-20 15:25 ET
Dow -134.60 at 29213.41, Nasdaq -11.13 at 9377.84, S&P -5.84 at 3323.78

[BRIEFING.COM] The S&P 500 continues to trade slightly lower by 0.2%, while the Russell 2000 underperforms with a 0.6% decline.

One last look inside the sector standings shows the energy (-1.6%), industrials (-1.0%), and materials (-1.0%) sectors down at least 1.0%, while the real estate (+1.0%) and utilities (+0.7%) sectors sport comfortable gains.

WTI crude settled down $0.30 (-0.5%) to $58.25/bbl amid general growth concerns pertaining to the coronavirus outbreak.