Stock market updates Monday: Dow rebound loses steam as day goes on, Tesla pops 19%
This is a live blog. Check back for updates.
4:00 pm: Stocks close up, but well off highs of the day
Stocks ended the day higher on Monday, gaining back some of Friday's losses. The Dow Jones Industrial Average closed up 143 points, well off the 374-point high of the day. The market drifted from highs as coronavirus fears lingered. The S&P 500 ended up about 0.7% and the Nasdaq rose about 1.3%. Key stocks Amazon and Apple closed lower. — Fitzgerald
2:59 pm: Final hour of trading: Stocks recover some of Friday's losses
With roughly one hour of trading left in Monday's session, the major averages were headed for solid gains, recovering some of the decline from Friday. The Dow is up around 200 points, while the Nasdaq and S&P 500 are each trading more than 1% higher. Still, the major averages are well off their highs as coronavirus fears linger. —Imbert
1:49 pm: China's rapid growth makes new coronavirus different from SARS, economist says
China accounts for 16% of the world nominal GDP, about four times the weight the economy had during the SARS outbreak in 2003, according Michael Darda from MKM Partners."This alone would suggest comparisons between the two outbreaks may not be especially helpful at this time," Darda said in a note to clients. Darda estimated that, based on how much bond yields have fallen since the current outbreak began, expectations for earnings growth in the S&P 500 should now be 2 to 3 percentage points lower than they were prior to the outbreak. — Pound
1:39 pm: Tesla shares rally as much as 20%
Tesla shares are having a historic day. The electric car maker's stock is up more than 15% and was up as much as 20% as it breaches the $700 mark for the first time. Tesla got a boost after an analyst at Argus Research hiked his price target on the stock to $808 per share (see below). To be sure, this surge to record levels could be a so-called short squeeze, which happen when a number of traders shorting the stock cover those positions, pushing the share price higher. —Imbert
12:58 pm: ISM manufacturing report vanishes from website
Today's market-moving manufacturing report from the Institute for Supply Management was taken down from the ISM website so that it could fix historic data from between 2012 and the end of 2019. The organization said there should be no impact on today's report." The January number remains unchanged. There is just a quick update being made to the historical data for one number in particular for suppliers deliveries," said ISM spokesperson Jessica Boyd. The action got the interest of market pros who were left looking at a release that said to come back later, in the same spot where the original release was posted. The report was removed in late morning, in the same hour that stocks were selling off on the latest coronavirus headline. It sparked some speculation that the positive January report was being revised. ISM's index of national factory activity increased to a reading of 50.9 last month, the highest level since July, from an upwardly revised 47.8 in December. —Domm
12:09 pm: Trade commitments uncertain even before outbreak
Ron Temple, co-head of multi-asset and head of U.S. equity at Lazard Asset Management, said it was too early to know the full impact of the coronavirus in China but that there were already questions about China's commitments in the phase one trade deal. As part of the deal, China agreed to purchase an additional $200 billion of U.S. goods over the next two years. Stocks slipped from their highs earlier Monday after Bloomberg News reported that Chinese officials are seeking flexibility from the U.S. on some of those promises."I would be in no way surprised" if the U.S. says China failed to reach its purchase agreements, Temple said. — Pound
11:57 am: Stocks come off highs on report of coronavirus involving former Carnival passenger
The Dow retreated from its highs after Carnival Corp. confirmed that a former passenger tested positive with the coronavirus. Shares of Carnival dipped nearly 2%.
"On the previous voyage, a guest from Hong Kong, embarked in Yokohama on January 20, sailed one segment of the itinerary, and disembarked in Hong Kong on January 25. He visited a local Hong Kong hospital, six day after leaving the ship, where he later tested positive for Coronavirus on February 1," the statement from Carnival read.
The Dow was up more than 300 points at the high and was last up about 170 points.—Fitzgerald
11:41 am: Oil sinks to lowest level in more than a year
Oil extended last week's losses, with international benchmark Brent crude falling more than 3% and trading below $55 per barrel for the first time in 13 months. U.S. West Texas Intermediate crude declined more than 2%, hitting a more than one year low of $50.31 per barrel. Traders worry that a global economic slowdown, sparked by the coronavirus outbreak, will weigh on oil demand. Monday's move lower came despite reports that OPEC+ is considering additional production cuts in order to provide a floor for prices. –Stevens, Hayes
11:39 am: Verizon falls on downgrade by Credit Suisse, capping gains in the Dow
Shares of Verizon dropped 1.4% to become the second biggest loser in the Dow, after Credit Suisse downgraded the company to neutral from outperform. The bank said it doesn't see any near-term catalysts to drive the wireless operator's stock higher. —Li
11:37 am: Nike leads the Dow higher
Shares of Nike rose nearly 5% in midday trading on Monday, making the shoe giant the biggest winner in the Dow Jones Industrial Average. Nike shares are rebounding after falling the past two weeks on coronavirus fears. Nike got a vote of confidence from UBS and JPMorgan this morning, which both said to buy the dip in Nike shares. –Fitzgerald
11:03 am: Treasury yields rise for the first time in four sessions
The yield on the benchmark 10-year Treasury note, which moves inversely to price, climbed 4 basis points to around 1.554%. Monday's action marks the first advance in four trading days for the 10-year yield, which has fallen about 30 basis points in the past two weeks on coronavirus fears. Rates hit their session highs after the ISM manufacturing Purchasing Managers' Index for January topped economists' estimate and signaled an expansion. The benchmark 10-year yield dipped below the three-month Treasury rate last week, sending a recession signal. —Li
11:00 am: Oil falls despite reports that OPEC is considering large production cut
As oil prices collapse, OPEC is considering additional production cuts that could exceed 1 million barrels per day. "I think it is a 'go big or go home' moment for the organization," RBC Capital Markets' Helima Croft said to CNBC. On Monday, U.S. West Texas Intermediate crude and international benchmark Brent crude both dropped to their lowest levels since Jan. 2019, before paring some of those losses, as the coronavirus outbreak continues to hit prices. Both WTI and Brent are trading in bear market territory and coming off a fourth straight week of losses. Earlier in the session WTI briefly turned positive after The Wall Street Journal reported, citing OPEC officials, that Saudi Arabia was considering a 1 million barrels per day cut in order to stimulate prices. The energy alliance's Joint Technical Committee, a non-ministerial sub group that reviews the oil market, will reportedly hold meetings Tuesday and Wednesday in Vienna. —Stevens
10:20 am: Market's next move could be decided by today's trading
Instinet's Frank Cappelleri says today's market action could help decide how bearish the market's tone has become. "For months, you didn't have any type of bearish pattern pop up much less follow through," said Cappelleri, Instinet executive director. That changed in the past two weeks with the more than 3.7% peak to trough decline in the S&P 500. If the market does not continue moving higher and head to its highs, there could be a steeper pullback, due to a bearish setup. The downside target would be 3,130. "A lot has to do with how this initial lift works out today," he said, noting the opening surge higher could weaken or reverse. The S&P 500 was trading just under 3,250 in morning trading. "We still have to be concerned if the next lift is a lower high," which would be negative, he said. "We're so used to having any pullback being 2 to 4%." — Domm
10:17 am: El-Erian says coronavirus to 'paralyze China,' don't buy stock dips
Economist Mohamed El-Erian told CNBC's "Squawk Box" on Monday that investors should "try and resist our inclination to buy the dip" in the stock market. The Allianz chief economic advisor and ex-Pimco CEO sees the coronavirus outbreak as a game-changer. "For a long time I though the market sentiment was so strong that we could overcome a mounting list of economic uncertainty," he said. "But the coronavirus is different. It is big. It's going to paralyze China. It's going to cascade throughout the global economy." —Belvedere
10:15 am: Stocks pare gains slightly on China trade news
The Dow cut some of the morning gains, last up 323 points, after a headline from Bloomberg News said the Chinese are seeking flexibility from the U.S. side on some promises in the phase one trade deal. Bloomberg News, citing sources familiar with the matter, said the deal reached early January has a clause that the countries will consult "in the event that a natural disaster or other unforeseeable event." The Dow was up 362.01 points before the trade news was released. CNBC has reached out to the White House for comments. —Li
10:12 am: ISM manufacturing activity rebounds in January
Stocks got an added boost from an encouraging read on the manufacturing economy on Monday. The Institute for Supply Management (ISM) said its index of national factory activity increased to a reading of 50.9 in January, the highest level since July. Economists polled by Dow Jones were expecting a reading of 48.5, as the last five readings contracted. Any reading below 50 signals a contraction. All three major averages are up over 1%, gaining back about half of Friday's losses. —Fitzgerald
10:08 am: Argus raises Tesla price target to Street high of $808
Argus Research now has the highest Tesla price target among analysts on Wall Street, increasing its outlook to $808 a share from $556 a share on Monday. Argus said it sees continued growth in sales of Tesla's Model S and Model X models, "as well as strong demand for the new Model 3." Tesla shares rose nearly 11% in early trading from its previous close of $650.57. — Sheetz
9:49 am: Apple turns positive, stocks at session highs
The market has risen to new session highs and by no coincidence, Apple is now in the green slightly. Apple was the one big notable laggard in early trading, but its reversal has given bulls confidence to take the market even higher. Dow up 260. — Melloy
9:40 am: Tepper says outbreak 'may be a game changer'
Appaloosa Management's David Tepper was bullish on the market just a few weeks ago, but is now urging caution as the new coronavirus outbreak continues to spread. Tepper told Jim Cramer in an interview for TheStreet that the outbreak has "certainly ruined the environment" that made him bullish on stocks."You have to be careful, because it may be a game changer. So you've just got to be cautious," Tepper said. —Pound
9:35 am: Latest on Coronavirus
China's National Health Commission on Monday confirmed 17,205 cases of the coronavirus in the country and 361 deaths. The number has surpassed that of the SARS virus which lasted from 2002 to 2003. Meanwhile, a first death outside of China was reported in the Philippines over the weekend. Follow CNBC's coronavirus live blog for updates. —Li
9:30 am: Dow up 100, but Apple is a drag
The Dow is taking a little bit of Friday's 600-point drop back on Monday. Lots of green on the board with advancers outnumbering decliners on the NYSE by 3.5-to-1. Nike among the biggest gainers on Wall Street recommendations of buying the dip (see below). But look no further than Apple to see how coronavirus is still looming large over the market. Apple is off on fears its sales will take a hit from the virus and concern production could be disrupted as well. - Melloy
9:11 am: Goldman Sachs double downgrades Northrop Grumman
Shares of Northrop Grumman slid 1.8% in premarket trading after Goldman Sachs lowered its rating on the defense and aerospace giant to sell from buy. Goldman said "differentiated growth keeps not coming through" for Northrop Grumman and "margins are compressing." In terms of its price-to-earnings ratio, Northop Grumman is "the most expensive large-cap defense stock," Goldman added. —Sheetz
9:01 am: Apple analyst slashes iPhone shipment forecast by 10% amid coronavirus epidemic
TF International Securities cut its iPhone shipment forecast by 10% for the current quarter due to worries about the Chinese coronavirus. ″Our latest survey indicates that the iPhone supply is being affected by the coronavirus and, therefore, we cut the iPhone shipment forecasts by 10% to 36-40 mn units in 1Q20," Apple analyst Ming-Chi Kuo said in the note. Kuo said it is unclear if the second quarter of 2020 will be effected. Shares of Apple dipped 0.7% in premarket trading on Monday. —Fitzgerald
8:51 am: Gilead climbs on news of experimental coronavirus drug
Shares of Gilead Sciences rose 4.5% in premarket trading on news that the company is offering an experimental drug to treat the new coronavirus. The drug, called remdesivir, is not licensed or approved in any country, the company said in a statement, but it is being used as emergency treatment in some cases. "Gilead is working with health authorities in China to establish a randomized, controlled trial to determine whether remdesivir can safely and effectively be used to treat 2019-nCoV," the company said. —Pound
8:47 am: Biggest analyst calls of the day
- Credit Suisse downgraded Verizon to neutral from outperform.
- Wedbush added Uber to the best ideas list.
- Stifel upgraded Seagate Technology to buy from hold.
- Credit Suisse downgraded ViacomCBS to neutral from outperform.
- Credit Suisse upgraded Charter Communications to outperform from neutral.
- UBS upgraded Nike to buy from neutral.
- JPMorgan added Nike to the focus list.
- Goldman Sachs downgraded Exxon Mobil to sell from neutral.
- Telsey upgraded Abercrombie & Fitch to outperform from market perform.
- Goldman Sachs upgraded Ulta to buy from neutral.
- Goldman Sachs downgraded Northrop Grumman to sell from buy.
- BMO downgraded Electronic Arts to market perform from outperform.
- Morgan Stanley upgraded Monster Beverage to overweight from equal weight.
- RBC upgraded Colgate-Palmolive to outperform from sector perform
CNBC Pro subscribers can read more here. —Bloom
8:44 am: Alphabet climbs ahead of earnings
Shares of Alphabet rose in premarket trading as investors prepared for the tech giant's earnings announcement after the bell. KeyBanc Capital Markets analyst Andy Hargreaves said in a note to clients previewing earnings season that he expected the tech giant to post net advertising revenue growth of 17.7% and a gross margin of 53.6%.Other large tech companies have seen wide swings following quarterly reports this earnings season. Amazon rose 7.4% in the session following its report, while Facebook slid 6.1%. The stock price for Google's parent company was up about 1.1% before the bell. —Pound
8:40 am: China stocks plummet on coronavirus fears, Shanghai index drops 7.7%
Chinese stocks tanked overnight in their first trading session since closing for the Lunar New Year holiday as the deadly coronavirus continues to spread. The Shanghai Composite dropped 7.7%, its biggest decline since Aug. 24, 2015. Meanwhile, the Shenzhen A Shares index closed more than 8% lower in its worst session since 2007. The death toll in China from the coronavirus reached 361 on Sunday, surpassing that of the SARS virus which lasted from 2002 to 2003. China's central bank announced it will inject 1.2 trillion yuan worth of liquidity into the economy in an effort to stymie a sharp economic slowdown. However, there are already signs the economy is hurting from the coronavirus. The Markit/Caixin manufacturing PMI came in at 51.1 for January, just below economy expectations. —Imbert
8:39 am: Wall Street says buy the dip in Nike's stock despite coronavirus fears
Shares of Nike jumped nearly 2% in premarket trading on Monday after UBS upgraded the stock to buy from neutral and JPMorgan added Nike to its "analyst focus list." The firms said they recommend buying the recent dip in Nike shares, which are trading below their historical P/E averages. Shares of Nike are down about 8% in the past two weeks on worries about the Chinese coronavirus's impact on Nike's China revenue. JPMorgan said the recent pullback is a "multi-year buying opportunity" and UBS said "the market will pay a much higher P/E for NKE as it realizes how Nike's business model changes will make the company worth much more long-term." —Fitzgerald
8:30 am: Dow futures rise 150 points as Wall Street tries to rebound from big sell-off
Stock futures pointed to a solid start for Monday's session after investors suffered their biggest losses in recent months. Dow Jones Industrial Average futures are up more than 150 points while S&P 500 futures are up 0.7%. Those gains come after the Dow plummeted around 600 points on Friday — its worst day since August — while the S&P 500's 1.8% drop was its biggest one-day drop since October. Friday's sell-off wiped out the averages' gains for January and snapped four-month winning streaks. —Imbert
—With reporting by Michael Bloom, Michael Sheetz, John Melloy, Yun Li, Patti Domm, Pippa Stevens, Christopher Hayes.