Stocks opened lower following a report that GDP growth slowed in the fourth quarter in China, which sparked global growth concerns. The averages moved in a narrow range once they found a level and are currently at the low end of their range for the session. The earnings season picks up in earnest this week and investors will be watching guidance closely.
ECONOMIC EVENTS: In the U.S., existing home sales fell sharply in December. The annualized rate of sales declined 6.4% to 4.99M homes, which marked the lowest level since November 2015.
In China, GDP grew 6.4% in the fourth quarter of 2018 from a year earlier, which was in line with expectations. However, it was slower than the previous quarter's 6.5% growth and the weakest expansion since the financial crisis.
COMPANY NEWS: Shares of Arconic (ARNC) plunged 17% after the company announced that its Board of Directors has determined to no longer pursue a potential sale of the company after it did not receive a proposal for a full-company transaction that it believes "would be in the best interests of Arconic's shareholders and other stakeholders." As recently as last week, both the New York Post and The Wall Street Journal had reported that Apollo Global Management (APO) was close to a deal to acquire Arconic for around $22 a share, or over $10B.
Dow members Johnson & Johnson (JNJ) and Travelers (TRV) both issued their earnings reports for the last quarter of 2018. The pharmaceutical and personal care giant is down 2% despite earnings and revenue that topped the consensus forecast, while the insurance major is fractionally lower at midday.
eBay (EBAY) shares have jumped 7% after Elliott Management announced an over 4% stake and urged the company to make changes, including undertaking a portfolio review. The activist investor stated in a publicly disclosed letter to the company's board that it believes eBay could be valued at $55-$63 per share if the company takes steps the firm recommends, including considering options for its StubHub and Classifieds Group businesses and taking steps to "revitalize" its core Marketplace business.
MAJOR MOVERS: Among the noteworthy gainers was Under Armour (UAA), which rose 1% after Goldman Sachs analyst Alexandra Walvis upgraded the stock to Conviction Buy and raised her price target for the shares to $28 from $24. Also higher was New Oriental Education (EDU), which gained 6% after reporting quarterly results.
Among the notable losers was Editas Medicine (EDIT), which dropped 22% after announcing that Katrine Bosley has opted to step down from her role as president and CEO.
Also lower was Stanley Black & Decker (SWK), which fell 13% after reporting quarterly results.
INDEXES: Near midday,
the Dow was down 284.62, or 1.15%, to 24,421.73, the Nasdaq was down 103.82, or 1.45%, to 7,053.41, and the S&P 500 was down 33.11, or 1.24%, to 2,637.60.