S&P ends little changed as White House reportedly weighs new tax cut package
Stocks spent the day trading around the flatline after data showing that U.S. retail sales rose in January and a reading on consumer sentiment hit its highest level in about two years. Meanwhile, China's Hubei province, the epicenter of the coronavirus outbreak, reported almost 5,000 new cases, but the estimate of the death toll in China was trimmed to 1,380 as officials said they had found some double counting. Despite the tepid trading in the last session of the week, stocks closed out with gains on a weekly basis ahead of the long holiday weekend.
ECONOMIC EVENTS: In the U.S., retail sales increased 0.3% for both the headline and ex-autos figures in January. Import prices were flat in January, and export prices rose 0.7%. Industrial production fell 0.3% in January, with capacity utilization slipping to 76.8%. Business inventories rebounded 0.1% in December with sales dipping 0.1%. The preliminary University of Michigan consumer sentiment survey for February rose 1.1 to 100.9, which was better than expected. In energy news, Baker Hughes reported that the U.S. rig count is unchanged from last week at 790, with oil rigs up 2 to 678.
In White House news, CNBC reported that the Trump administration, as part of a forthcoming tax cut package, is considering ways to incentivize U.S. households to invest in the stock market. The proposal would see a portion portion of household income treated as tax-free for the purposes of investing outside a traditional 401(k), according to CNBC's Kayla Tausche.
TOP NEWS: On the earnings front, shares of Nvidia (NVDA) rose 7% after the company reported better than expected results for the fourth quarter and provided upbeat guidance for the upcoming quarter. Many analysts raised their price targets on the stock following the report, with RBC Capital analyst Mitch Steves saying he expects the stock to continue to work higher given the improvement in its mix of business as well as the quality of its earnings and margins.
Expedia (EXPE) shares jumped 11% after the company reported upbeat Q4 results and guided for "double-digit" EBITDA territory for fiscal 2020. The company noted on its quarterly call, however, that it expects first quarter adjusted EBITDA to be "down substantially" and that it sees a $30M-$40M impact on adjusted EBITDA in Q1 from pressures related to the coronavirus outbreak.
Mattel (MAT) reported better than expected earnings and revenue for the fourth quarter and guided for 2020 gross sales growth as reported of 1%-2.5%. Despite the results and JPMorgan analyst Tami Zakaria raising her price target on the shares, Mattel fell over 3%.
Meanwhile, Yelp (YELP) shares dropped 3.3% after the company reported lower than expected quarterly results, provided fiscal 2020 revenue growth guidance, and named David Schwarzbach as its new CFO.
Additionally, Reuters reported that United Airlines (UAL) extended the cancellation of Boeing (BA) 737 flights until September 4. Reuters noted that Southwest Airlines (LUV) extended its MAX cancellations yesterday until August 10.
MAJOR MOVERS: Among the noteworthy gainers was BioXcel Therapeutics (BTAI), which surged 55% after SunTrust Robinson Humphrey analyst Robyn Karnauskas more than sextupled her price target on the shares to $150 from $24. Also higher were ImmunoGen (IMGN) and Canopy Growth (CGC), which gained a respective 26.9% and 13.4% after reporting quarterly results.
Among the notable losers was Roku (ROKU), which slid 6.3% after it reported quarterly results and provided fiscal 2020 revenue guidance. Also lower after reporting quarterly results were CarGurus (CARG) and LivePerson (LPSN), which fell 26.5% and 24.5%, respectively.
INDEXES: The Dow fell 25.23, or 0.086%, to 29,398.08, the Nasdaq gained 19.21, or 0.20%, to 9,731.18, and the S&P 500 advanced 6.22, or 0.18%, to 3,380.16.