S&P starts week with drop ahead of banks' earnings reports
The S&P 500 slid to start the week as investors brace for the first round of earnings reports from the nation's biggest banks. As the coronavirus outbreak continues to shut down the economy, the Governors of New York, New Jersey, Connecticut, Pennsylvania, Delaware and Rhode Island announced they have formed a regional advisory council to help guide their re-opening once the COVID-19 emergency has passed. NJ Governor Phil Murphy stated that his state and its Northeast neighbors "must be smart and tactical in how our region comes out of this, or else we'll be right back to square one."
The joint announcement came only hours after President Trump asserted it was his call to make, not that of state governors, as to the decision to open up the states.
In other political news, Senator Bernie Sanders joined a livestream with former vice president Joe Biden about the economic response to the coronavirus pandemic to announce his support and endorsement for his former rival in the run to be president. Sanders dropped out of the race last week, but had not immediately endorsed Biden formally.
Meanwhile, oil surrendered its early gains despite an unprecedented deal by the world’s biggest producers to cut their output.
ECONOMIC EVENTS: In the U.S., no data of note was reported. In Europe, markets were closed for Easter Monday and some Asian markets are shut as well.
The OPEC+ alliance announced it will cut 9.7 million barrels per day of oil production, which would be nearly 10% of global supply and more than twice the cuts seen during the global financial crisis.
New York Governor Andrew Cuomo reported 195,031 total cases of the virus in the state, with 10,056 total deaths. Cuomo noted that while the curve continues to flatten and "it appears we have a plateau," he added that reopening of schools and non-essential businesses in the state is "a delicate balance." Cuomo and the governors of five neighboring states said they they intend to coordinate a plan to reopen businesses and schools after getting the COVID-19 outbreak under control.
TOP NEWS: Gilead (GILD) announced results from an analysis of 53 patients hospitalized with severe complications of COVID-19 who were treated with the investigational antiviral remdesivir on an individual compassionate use basis, reporting an improvement in oxygen support class for 68% of patients over a median follow-up of 18 days from the first dose of remdesivir.
Ford (F) announced that it currently expects to report revenue of about $34B and first quarter adjusted losses before interest and taxes of about $600M, which excludes about $300M of special-item charges. Tim Stone, Ford's CFO, said that while the company "opportunistically" assesses funding options it foresses sufficient cash "to get us through at least the end of the third quarter with no incremental vehicle production and wholesales or financing actions."
eBay (EBAY) shares closed 2.7% higher after the company appointed Jamie Iannone, who was most recently COO of Walmart (WMT) eCommerce, as the marketplace operator's CEO, effective April 27.
Additionally, shares of Amazon (AMZN) rose 6.2% after the company said that its previously communicated 100,000 jobs pledge is filled and it is going to continue to hire, creating an additional 75,000 jobs to "help serve customers during this unprecedented time." Also, the Wall Street Journal reported that Amazon will start allowing third-party sellers onto its platform to ship "nonessential" items to the company this week, a signal that the e-commerce giant is ramping up to meet wider consumer needs.
Meanwhile, Reuters reported over the weekend that major U.S. airlines were urging Treasury officials and the federal government's outside advisers to scrap or revise a proposal that would make part of the $25B earmarked by Congress to help keep workers on the payroll repayable in the form of low-cost loans. Treasury Secretary Steven Mnuchin told the airlines on Friday the government would require them to repay 30% of the grants in low-cost loans over 10 years - with the first five years at 1% interest - before the interest rate would rise. Publicly traded companies in the space include Alaska Air (ALK), American Airlines (AAL), Delta Air Lines (DAL), JetBlue (JBLU), Southwest (LUV), Spirit Airlines (SAVE) and United Airlines (UAL).
MAJOR MOVERS: Among the noteworthy gainers was BioCryst (BCRX), which rose 13.5% after it opened enrollment for its galidesivir trial in patients with COVID-19. Also higher was Athersys (ATHX), which gained 18.9% after the FDA authorized its Phase 2/3 study to assess the efficacy of MultiStem therapy in patients with severe acute respiratory distress syndrome induced by the novel coronavirus disease.
Among the notable losers was Sabre (SABR), which declined over 15% after the U.K.'s Competition and Markets Authority blocked the company's acquisition of Farelogix. Also lower was AMC Entertainment (AMC), which fell 20% after the New York Post reported that the company is nearing a potential bankruptcy and is in talks to hire bankruptcy law firm Weil Gotshal.
INDEXES: The Dow fell 328.60, or 1.39%, to 23,390.77, the Nasdaq gained 38.85, or 0.48%, to 8,192.42, and the S&P 500 declined 28.19, or 1.01%, to 2,761.63.