Stocks ended the week on a down note following the announcements from Texas and Florida of new closures on bars and restaurants amid spikes in both cases of newly diagnosed COVID-19 cases. The weakness in the market was exacerbated by The Wall Street Journal's report that China is subtly warning the U.S. that it may risk the Phase One trade deal if the U.S. "meddles" in Hong Kong. "The U.S. side should refrain from going too far with meddling" and "red lines shouldn't be crossed," an unnamed official warned, according to the report.
ECONOMIC EVENTS: In U.S. data, personal income declined 4.2% in May, with consumption bouncing 8.2%. The University of Michigan consumer sentiment index came in at 78.1 in the final June print, a little below the 78.9 preliminary reading. In energy news, Baker Hughes reported that the U.S. rig count is down 1 rig from last week to 265.
In COVID-19 news, Arizona reported a 5.4% increase in virus cases since yesterday, while California reported a 2.5% increase and Florida reported a 7.8% increase. Texas Governor Greg Abbott issued an executive order limiting certain businesses and services as part of the state's efforts to contain the spread of the coronavirus. Meanwhile, the Florida Department of Business and Professional Regulation suspended on premises consumption of alcohol at bars statewide. In addition, Reuters reported that U.S. Vice President Mike Pence has called on Americans to engage in social distancing amid the spike in COVID-19 cases.
TOP NEWS: Unilever (UL), Verizon (VZ), and Procter & Gamble (PG) are among companies that have halted or are evaluating advertising their products in the U.S. on Facebook (FB), with Verizon chief media officer John Nitti saying that the company is pausing its advertising until "Facebook can create an acceptable solution" on hate speech "that makes us comfortable and is consistent with what we've done with YouTube and other partners." Unilever is also halting advertisements on Twitter (TWTR), saying that there is "much more to be done" on hate speech on social media platforms. In a town hall meeting on Friday afternoon, Facebook CEO Mark Zuckerberg said that the company will start labeling content that Facebook finds newsworthy that might otherwise violate policies, since they may have "public interest value," such as certain posts or comments by politicians.
After the market close Thursday, the Federal Reserve Board released the results of its stress tests for 2020 and additional sensitivity analyses that the board conducted in light of the coronavirus event. The board noted that for Q3 of this year, it is requiring big banks to preserve capital by suspending share repurchases, capping dividend payments, and allowing dividends according to a formula based on recent income. The board is also requiring banks to re-evaluate their longer-term capital plans. Publicly traded large banks include Bank of America (BAC), Citi (C), Goldman Sachs (GS), JPMorgan (JPM), Morgan Stanley (MS), U.S. Bancorp (USB) and Wells Fargo (WFC).
Amazon (AMZN) confirmed the acquisition of self-driving car developer Zoox. While terms of the transaction were not disclosed by either company, Joann Muller of Axios reported that Amazon is paying $1.2B for Zoox.
On the earnings front, Nike (NKE) shares fell 7.5% after the sneaker and apparel giant reported lower than expected Q4 results, with Nike Brand revenues for the quarter falling 38% year-over-year.
Meanwhile, shares of Microsoft (MSFT) closed 2% lower after announcing a strategic change in its retail operations, including closing physical Microsoft Store locations. The closing of the Microsoft Stores will result in a pre-tax charge of 5c per share to be recorded in the current quarter ending June 30, the company said.
Grocery store owner Albertsons (ACI) became the biggest IPO of the year with its public debut this morning. The stock opened at $15.50, below the pricing of $16 per share, and closed its first day of trading at $15.59.
MAJOR MOVERS: Among the noteworthy gainers was Vaxart (VXRT), which jumped 28.4% after the company's COVID-19 vaccine was selected for the U.S. government's Operation Warp Speed. Also higher was CoreLogic (CLGX), which rose 28.4% after Cannae (CNNE) and Senator announced a proposal to acquire CoreLogic for $65 per share. Cannae shares were 1.4% lower after the news. In addition, Gap (GPS) shares surged 18.8% higher after the retailer announced a collaboration with rapper Kanye West to sell a new line of apparel for men, women and children known as Yeezy Gap.
Among the notable losers was DBV Technologies (DBVT), which slid 13.7% after initiating a a global restructuring plan, which is expected to include a significant reduction in workforce, and citing the possibility of a delay in timelines for the Viaskin Peanut BLA review. Also lower was Apogee Enterprises (APOG), which fell 7.3% after reporting quarterly results.
INDEXES: The Dow fell 730.05, or 2.84%, to 25,015.55, the Nasdaq lost 259.78, or 2.59%, to 9,757.22, and the S&P 500 declined 74.71, or 2.42%, to 3,009.05.
Bank of America
-1.57 (-6.35%)
Citi
-3.13 (-5.94%)
Goldman Sachs
-18.28 (-8.82%)
Morgan Stanley
-1.73 (-3.55%)
JPMorgan
-5.31 (-5.43%)
U.S. Bancorp
-2.02 (-5.31%)
Wells Fargo
-2.01 (-7.35%)
Amazon.com
-60.63 (-2.20%)
Nike
-7.82 (-7.71%)
Microsoft
-4.03 (-2.01%)
Albertsons
+ (+0.00%)
Use symbol UL
-0.33 (-0.60%)
Unilever
-0.365 (-0.65%)
Verizon
-1.12 (-2.06%)
Procter & Gamble
-2.74 (-2.32%)
Ticker changed to META
-19.59 (-8.32%)
-2.32 (-7.40%)
Vaxart
+1.66 (+26.18%)
CoreLogic
+14.915 (+28.18%)
Cannae Holdings
-0.61 (-1.53%)
Gap
+1.89 (+18.58%)
DBV Technologies
-0.75 (-13.89%)
Apogee Enterprises
-1.76 (-7.82%)