The major averages are mixed at midday with the S&P and Dow lower and the Nasdaq seeing mild gains. Trading is range-bound to close out the week as many cross-currents tug at the markets, including the spreading virus, renewed restrictions, vaccine developments, stimulus uncertainties, and worrisome outlooks on the economy.
ECONOMIC EVENTS: In the U.S., the Fed and Treasury Secretary Steven Mnuchin appear to be divided on emergency lending facilities. Mnuchin indicated late yesterday in a letter to Fed Chair Jerome Powell that the Main Street Lending, corporate credit, and municipal credit programs would not be extended into 2021, with the leftover funds to be returned to the Treasury for reallocation. However, the Treasury Secretary indicated he will seek a 90-day extension for several other programs. Currently, all of the emergency programs under the CARES Act will expire on December 31. The Fed wrote back it would "prefer that the full suite of emergency facilities...continue to serve their important role as a backstop for our still strained and vulnerable economy." Mnuchin did also note that the facilities could be re-instituted with Congressional approval or with other Treasury funds.
Data from the Johns Hopkins Whiting School of Engineering shows there are now 57.2M confirmed cases of COVID-19 worldwide, including 11.7M in the U.S., and 1.36M deaths due to the disease, including about 253,000 in the U.S.
TOP NEWS: Shares of Pfizer (PFE) and BioNTech (BNTX) were both higher near noon after the companies said they will submit a request today to the U.S. FDA for Emergency Use Authorization of their mRNA vaccine candidate, BNT162b2 against COVID-19, which will potentially enable use of the vaccine in high-risk populations in the U.S. by the middle to end of December 2020. The companies said their combined manufacturing network has the potential to supply up to 50M vaccine doses globally in 2020 and up to 1.3B doses by the end of 2021.
On the earnings front, shares of Foot Locker (FL) were 5% lower despite the company's report of better than expected Q3 earnings and revenue. Of note, the company said on its quarterly conference call that the current economic environment may continue to pose challenges for the sneaker retailer.
Meanwhile, Workday (WDAY) shares fell 7% despite the company reporting better than expected Q3 earnings and revenue and raising its fiscal 2021 subscription revenue guidance. Following the results, no fewer than three analysts raised their price targets on the shares, and Canaccord analyst Hynes David said that investors should buy Workday on the weakness.
FireEye (FEYE) shares jumped 7% after the company announced a $400M strategic investment led by Blackstone Tactical Opportunities (BX) to "support the company's vision to create the industry's leading intelligence-led cyber security platform and services company." Under the terms of its investment, Blackstone and ClearSky will purchase $400M in shares of a newly designated 4.5% Series A Convertible Preferred Stock of FireEye, with a purchase price of $1,000 per share. The Series A Preferred will be convertible into shares of FireEye's common stock at a conversion price of $18.00 per share. FireEye also announced that it had acquired Respond Software, a cybersecurity investigation automation company and creator of the Respond Analyst.
MAJOR MOVERS: Among the noteworthy gainers was Mesoblast (MESO), which rose 16% after it reported quarterly results and entered into a global collaboration on Remestemcel-L with Novartis (NVS). Also higher after reporting quarterly results was Williams-Sonoma (WSM), which gained 7%.
Among the notable losers was Avrobio (AVRO), which declined 15% after its 5M share spot secondary offering priced at $15 per share. Also lower were GSX Techedu (GSX) and Post Holdings (POST), which fell 16% and 6%, respectively, after reporting quarterly results.
INDEXES: Near midday, the Dow was down 150.60, or 0.51%, to 29,332.63, the Nasdaq was up 18.25, or 0.15%, to 11,922.96, and the S&P 500 was down 9.25, or 0.26%, to 3,572.62.
Pfizer
+0.45 (+1.24%)
BioNTech
+6.67 (+7.03%)
Foot Locker
-1.915 (-4.63%)
Workday
-16.55 (-7.17%)
Changed symbol to MDNT
+0.955 (+6.71%)
Blackstone
+0.13 (+0.22%)
Mesoblast
+2.16 (+18.35%)
Novartis
+0.07 (+0.08%)
Williams-Sonoma
+7 (+6.91%)
Avrobio
-2.48 (-14.63%)
Symbol now GOTU
-12.25 (-17.13%)
Post Holdings
-6.62 (-6.85%)