Stocks come off lows, finish mixed following Trump press conference on China
Stocks were mostly weaker near midday after a rapid pullback on Wall Street seen late yesterday driven by news President Trump would hold a press conference today, during which he was expected to discuss the U.S. reaction to China's bid to strengthen its hold over Hong Kong. His press conference in the afternoon included some strong language, but did not make any indication that the U.S. would withdraw from its trade pact with China or impose financial sanctions, which came as a bit of a relief to the market. The averages came off their lows after the event, where President Trump did not take any questions, either about his escalating feud with Twitter or the protests and rioting that have occurred in Minnesota.
ECONOMIC EVENTS: In U.S. data, the advance goods trade deficit widened to $69.7B in April from a revised estimate of $65.0B for March. The University of Michigan consumer sentiment index slipped to 72.3 in the final May estimate from 73.7 in the preliminary May report. However, it's still a little better than the 8-year low of 71.8 from April. The personal income report sharply beat estimates, with a 10.5% April surge for income that reflected a much bigger boost from the CARES Act than analysts projected alongside a 13.6% drop in consumption that was a smaller decline than assumed. The Chicago PMI dropped further in May, sliding 3.1 points to 32.3. In energy news, Baker Hughes reported that the U.S. rig count is down 17 rigs from last week to 301 with oil rigs down 15 to 222.
Meanwhile, President Donald Trump said during an afternoon press conference that the U.S. will begin terminating its relationship with the World Health Organization, with the president alleging that the WHO is "completely controlled" by China. The president added that the nation will suspend entry to the U.S. of certain foreign nationals from China and that working groups will study the practices of U.S.-listed Chinese companies. Trump ended the conference without taking any questions.
In New York, Governor Andrew Cuomo reported 67 coronavirus deaths in the state yesterday versus 74 deaths the previous day. The governor added that New York City is expected to begin reopening on June 8, as he said he believed the city would meet health benchmarks by then.
TOP NEWS: Social media companies, led by Twitter (TWTR), have been a target for President Donald Trump after he signed an executive order on Thursday that seeks to limit the broad legal protection that federal law currently provides to online platforms. Trump signed an executive order that seeks to modify a law protecting social media companies after Twitter tagged Trump's tweets for fact checking. After the president issued the executive order, Twitter went after another one of Trump's tweets, saying that a recent tweet of his violated the company's glorification of violence policy. Following the move, the president tweeted that Twitter was "doing nothing about all of the lies & propaganda being put out by China or the Radical Left Democrat Party," alleging that the company has "targeted Republicans, Conservatives & the President of the United States. Section 230 should be revoked by Congress. Until then, it will be regulated!"
Shares of Salesforce (CRM) fell 3.5% following the company's Q1 results. Morgan Stanley analyst Keith Weiss said Salesforce's positive tone on April and May pipeline builds and improving long-term secular positioning "stood in sharp contrast" to the company's weak FY21 guidance.
Occidental Petroleum (OXY) shares also fell 5.1% after the company reduced its quarterly dividend by about 90%, to 1c per share from 11c per share.
Meanwhile, The Wall Street Journal reported that Tencent (TCEHY) is in talks to acquire a stake in Warner Music Group (WMG) worth $200M as part of the record company's initial public offering.
Additionally, shares of Costco (COST) were fractionally lower after the company reported sales and earnings last night that missed consensus forecasts.
MAJOR MOVERS: Among the noteworthy gainers was Adaptimmune (ADAP), which jumped 128% to $11.07 after the company presented updated clinical trial data at the American Society for Clinical Oncology annual meeting. Also higher were Glu Mobile (GLUU) and Williams-Sonoma (WSM), which gained a respective 15% and 13.8% after reporting quarterly results or guidance.
Among the notable losers was Arvinas (ARVN), which fell 25.8% after it reported updated dose escalation data from its trial of ARV-110. Also lower were Canopy Growth (CGC) and Nordstrom (JWN), which dropped 20% and 11%, respectively, after reporting quarterly results. In addition, Minerva (NERV) shares declined 72.5% after it said that its Phase 3 trial of roluperidone did not meet its primary endpoint.
INDEXES: The Dow fell 17.53, or 0.069%, to 25,383.11, the Nasdaq gained 120.88, or 1.29%, to 9,489.87, and the S&P 500 advanced 14.58, or 0.48%, to 3,044.31.