Stocks look to build on yesterday's historic surge
The Dow is trying for its first back-to-back winning sessions in nearly two months a day after the blue chip index surged 11.4% for its best single day performance since 1933. The other major averages are also higher following the Senate leaders came to an agreement on a $2 trillion stimulus package. The legislation will provide direct financial checks to many Americans, drastically expand unemployment insurance, offer hundreds in billions in loans to both small and large businesses, and provide health care providers with additional resources as the virus spreads, according to The Wall Street Journal, although full details of the package are still unclear and Congress will still need to pass the measure. House Republicans are falling in line behind the Senate stimulus plan and are willing to allow quick passage of the plan, according to a source that spoke to CNN.
ECONOMIC EVENTS: In U.S. data, durable goods orders increased 1.2% in February. The FHFA house price index rose 0.3% to 284.4 in January.
Meanwhile, the latest data from the Johns Hopkins Whiting School of Engineering shows there are now 438,749 cases of COVID-19 and 19,675 deaths. In New York, which has become the "epicenter" of the outbreak in the U.S., Governor Andrew Cuomo said 30,811 people have tested positive, 12% are currently hospitalized, and 3% of positives are ICU patients.
TOP NEWS: Shares of U.S. airlines were trading higher after U.S. legislative leaders and the Trump administration reached a deal over an estimated $2T stimulus bill aimed at mitigating the economic impacts from the coronavirus outbreak, which includes a $50B package for the U.S. airline and cargo industry. Following the news, Deutsche Bank analyst Michael Linenberg upgraded to Buy from Hold shares of American Airlines (AAL), Alaska Air (ALK), Delta Air Lines (DAL), JetBlue (JBLU), Southwest (LUV), Spirit Airlines (SAVE) and United Airlines (UAL), and upgraded Hawaiian Holdings (HA) to Buy from Sell, saying he believes the stimulus package will support the sector at least through 2020, "and that is even after assuming a draconian outlook for air travel demand for the remainder of the year."
Boeing (BA) shares also jumped 31% after news of the stimulus agreement, with the Washington Post reporting that the package includes a $17B federal loan program for businesses deemd "critical to maintaining national security." While the provision does not mention the planemaker by name, two sources told the Post that the provision was crafted largely for Boeing's benefit.
Meanwhile, shares of Facebook (FB) were 1.5% lower near noon after the social media giant said in a blog post last night that it has seen a weakening in its ads business in countries taking aggressive actions to reduce the spread of COVID-19. Following the announcement, SunTrust analyst Youssef Squali cut his price target on the shares to $230 from $265, saying that while visibility on the turnaround timing is "poor," he expects Facebook to emerge from the crisis thanks to the growing user engagement, its effectiveness for advertisers, and its "excellent" financial position.
Additionally, CVS Health (CVS) was in focus after it announced that it is waiving cost-sharing and copays for inpatient hospital admissions related to COVID-19 for Aetna's commercially insured members.
MAJOR MOVERS: Among the noteworthy gainers was Apollo Commercial (ARI), which surged 83% after it said it is "well-prepared" to function remotely amid the coronavirus pandemic. Also higher was Two Harbors (TWO), which rose 65% after it suspended its first quarter common stock and preferred stock dividends.
Among the notable losers was WWE (WWE), which slid 8% after Loop Capital downgraded the stock to Sell from Hold, saying that a "transformative deal" for the company is not coming. Additionally, a 2.26M share block trade of WWE shares was priced at $38.00 per share.
Also lower was CenturyLink (CTL), which slid 3% after Citi analyst Michael Rollins downgraded the stock to Sell from Neutral, saying he sees rising risks to the business wireline market over the next two years given the spread of COVID-19 and the potential for economic weakness or recession to follow.
INDEXES: Near midday, the Dow was up 829.70, or 4.01%, to 21,534.61, the Nasdaq was up 91.80, or 1.24%, to 7,509.66, and the S&P 500 was up 56.30, or 2.30%, to 2,503.63.