Morning Brief

What to watch today: Dow to fall, Tesla's rally and coronavirus concerns



Worries over the spreading coronavirus are weighing on investor sentiment once again, with U.S. stock futures lower and world stock markets falling this morning. The Dow and S&P 500 are on track to post their second straight weekly losses since October. The Nasdaq could fall for two straight weeks for the first time since September. The Dow and S&P 500 are also on track to lose a good chunk of their remaining January gains at the open. However, the Nasdaq has been fairing better in 2020, with an advance of nearly 3.4% in January, as of Wednesday's close. (CNBC)

* 10-year Treasury yield falls to lowest level since early October as coronavirus fuels anxiety (CNBC)

The Federal Reserve held interest rates steady at its meeting this week and tweaked its post-meeting statement to reflect what appears to be a stronger commitment to nudge up inflation. On today's economic calendar, the government will issue the first look at fourth-quarter GDP at 8:30 a.m. ET, along with initial jobless claims for the week ending Jan. 25. (CNBC)

* Fourth quarter GDP could show economy entered a slower growth patch at year-end (CNBC)

A busy morning for earnings features the latest numbers from Dow components Coca-Cola (KO) and Verizon (VZ), as well as Altria (MO), AmerisourceBergen (ABC), Biogen (BIIB), Blackstone (BX), DuPont (DD), Eli Lilly (LLY), Hershey (HSY), Raytheon (RTN) and UPS (UPS). Today's after-the-bell earnings see Amazon (AMZN) and Dow component Visa (V) in the spotlight, along with Amgen (AMGN), Deckers Outdoor (DECK), FICO (FICO), Levi Strauss (LEVI) and Western Digital (WDC). (CNBC)

* Amazon's spending on one-day delivery is likely to weigh on fourth-quarter profit (CNBC)

Tesla (TSLA) shares extended their rally on Thursday, rising 10% in premarket trading following better-than-expected quarterly results. Facebook (FB) also beat on the top and bottom lines, but the stock fell more than 7% after the company reported rising costs and expenses and a narrowing operating margin. Microsoft (MSFT) beat on earnings and revenue, and the Dow stock was up more than 3% in the premarket. (CNBC)

* Elon Musk says Tesla won't raise capital, will focus on lowering cost of batteries (CNBC)
* Facebook's new metrics show it's still a one-trick pony (CNBC)


The spread of a fast-moving virus outside of China is of "grave concern" and has prompted the World Health Organization to reconvene an emergency meeting this week to decide whether it's become a global health emergency. The coronavirus outbreak has killed 170 people in China and sickened more than 7,711 across more than a dozen countries across the globe. (CNBC)

* India confirms first case of the coronavirus (CNBC)
* Australia defends plan to create island quarantine camp (AP)

Senators in Trump's impeachment trial peppered House Democrats and defense lawyers with questions yesterday, ahead of a crucial vote on whether to allow new witnesses and documents into the proceedings. That vote is expected to occur Friday, after the question-and-answer period of the trial ends. (CNBC)

* Battle escalates over John Bolton's bombshell book about Trump (CNBC)

President Donald Trump is holding a rally in Des Moines, Iowa, tonight, ahead of Friday's key Senate impeachment vote and the Iowa caucuses on Monday. Trump's campaign will follow the rally by sending a long list of GOP heavyweights to Iowa, including members of Trump's family, Cabinet officials and congressional leaders. (USA Today)

* Iowa could be a wake-up call for market if Bernie Sanders wins (CNBC)

A federal jury decided that Apple (AAPL) and Broadcom must pay $1.1 billion to the California Institute of Technology for infringing on patents. The lawsuit said Broadcom used its patented Wi-Fi data transmission technology in computer chips that went into iPhones, iPads, Apple Watches and other Apple devices. (AP)

The first all-electric vehicle for Ford Motor's (F) luxury Lincoln brand is being developed with EV start-up Rivian. The vehicle will use Rivian's "flexible skateboard platform," which underpins the vehicle, as part of a previously announced $500 million investment by Ford into the private company. (CNBC)

A government report will claim that Southwest Airlines (LUV) failed to prioritize safety while its regulator, the FAA, failed to do enough about it. Southwest pilots flew more than 17 million passengers on planes with unconfirmed maintenance records over roughly two years, according to a report viewed by The Wall Street Journal.

Kobe Bryant's wife of nearly 20 years broke her silence on the death of her husband and their 13-year-old daughter, Gianna, in a heartbreaking Instagram post Wednesday. She described the basketball legend as an adoring husband and father, and called Gianna "a loving, thoughtful, and wonderful daughter" and amazing sister. (NBC News)


Align Technology (ALGN) is expecting a $35 million hit to revenue due to virus-related business disruptions in China. That news is weighing on the stock, even though the maker of the Invisalign teeth straightening system beat Wall Street forecasts on the top and bottom lines for its latest quarter.

Mondelez (MDLZ) came in a penny ahead of analyst forecasts with adjusted quarterly earnings of 61 cents per share, and the Oreo-cookie maker also saw revenue beat estimates. However, Mondelez also said it expects current quarter revenue to take a hit from the coronavirus issue.

PayPal (PYPL) reported adjusted quarterly profit of 86 cents per share, 3 cents above estimates, while revenue was slightly above forecasts. However, the payment service gave a weaker-than-expected outlook for the current quarter and the full year.

Unilever (UL) is beginning a strategic review of its tea business, which includes the Lipton and PG Tips brands. The consumer products company decided on the review as sales of traditional black tea slow in favor of herbal tea.

Lyft (LYFT) cut 90 jobs, about 1.6% of its workforce, impacting the ride-hailing company's sales and marketing departments.


Japanese billionaire Yusaku Maezawa pulled out of a documentary search for a girlfriend to take on his voyage around the moon with Elon Musk's SpaceX, citing his "mixed feelings" about participating. This month, the 44-year-old announced he was seeking single females over 20 willing to vie to become his girlfriend for a documentary. Almost 28,000 people applied. (Reuters)