Dow Jones Off Lows After Crashing As Much As 960 Points On Coronavirus News; Apple, Microsoft Plunge
The Dow Jones Industrial Average crashed as much as 960 points Thursday before trimming losses after the CDC confirmed there is a U.S. coronavirus case of possible unknown origin. Apple stock and Microsoft stock tumbled about 3% each in the market sell-off.
Dow Jones stock Microsoft (MSFT) was among the worst stocks on the Dow 30 in today's stock market after the company warned that coronavirus would impact sales results. Last week, Apple (AAPL) warned its revenue may be lower than expected due to the Chinese coronavirus. Gilead Sciences (GILD) turned lower amid expanded drug trials for its remdesivir coronavirus drug. Payments leader Square (SQ) was a key earnings mover Thursday midday, gaining about 10%. IPO Leader Zoom Video (ZM) staged a breakout past a new buy point. Tesla (TSLA) skidded 10% on slowing China registrations.
(Check out the IBD Investing Action Plan for ongoing important stock market events and key earnings results.)
Dow Jones Dives On Coronavirus News: First U.S. Community Virus
The Dow Jones industrials dove Thursday after the CDC confirmed the first U.S. coronavirus case of unknown origin. A new case in Northern California has a "community origin," meaning its origin is unknown. The United States has 60 confirmed coronavirus cases.Outside the U.S., cases in South Korea, Italy and Iran continue to rise. South Korea virus cases have jumped to 1,766, while Italy has 528. Iran has 245.
Dow Jones Off Lows In New Stock Market Correction
The Nasdaq composite pared losses to 2% just after noon ET after falling as much as 4%. The S&P 500 was down 1.7%, while the Dow Jones industrials also lost 1.7%. At their lows, the S&P 500 and Dow 30 fell as much as 3.5% each.Among exchange traded funds, Innovator IBD 50 (FFTY) declined more than 1.5% Thursday morning. The ETF of top growth stocks set a new 52-week high just last week, but after huge losses in the overall market, the ETF is now down about 4% for the year. The IBD 50 ETF had been up more than 6% in 2020 before the current streak of losses.
This week, the stock market outlook was downgraded to a market in correction due to the sharp weakness in the major stock indexes, according to the IBD Big Picture. Investors should raise cash, avoid new buys on breakouts and create a watch list of top stocks.
Dow Jones Stocks: Apple, Microsoft
Among the Dow Jones stocks, Microsoft was one of the day's big losers, falling more than 3% in midday trade. Shares of the software maker were once again below their 50-day line, a key support level. Microsoft warned that its sales in the current quarter would fall short of its outlook due to spreading coronavirus outbreak. The announcement is the latest warning from tech giants on the impact of the coronavirus, joining Apple, HP (HPQ) and Mastercard (MA).Apple slid more than 4%, falling more than 15% off its 52-week high. The Dow Jones leader broke down through its 50-day line on Feb. 24.
Elsewhere in the Dow Jones industrials, Boeing (BA) and Intel (INTC) sold off 3.9% and 3.6%, respectively.
Among the rare gainers — only three Dow 30 stocks traded up on the day — drugmakers Merck (MRK) and Pfizer (PFE) rose more than 1% apiece. 3M (MMM) advanced almost 3%.
Stock Market News: Gilead, Square, Zoom Video
Key news movers Thursday include coronavirus drugmaker Gilead Sciences, payments leader Square and hot IPO stock Zoom Video. (For more earnings results, see Wednesday's IBD Investing Action Plan.)Gilead Sciences announced the start of two phase 3 clinical studies for potential coronavirus drug remdesivir. The drugmaker said it would begin two more clinical trials in more countries outside of China.
GILD stock surged more than 5%, hitting a 52-week high before reversing lower to fall about 1% in midday trade.
Square stock jumped 10% after the company's strong Q4 results late Wednesday. The payments company also updated its 2020 guidance. Shares regained their recent failed buy point.
A recent breakout above an 82.20 buy point in a cup with handle pattern failed this week amid the new stock market correction, according to MarketSmith chart analysis. The stock fell more than 7% below the entry, triggering the loss-cutting sell rule.
According to the IBD Stock Checkup, Square stock boasts a 97 out of a best-possible 99 IBD Composite Rating. The IBD Composite Rating helps investors easily measure the quality of a stock's fundamental and technical metrics.
Zoom Video stock jumped as much as 10% to 118 Thursday, attempting another breakout past a 107.44 buy point in a cup base. The IPO stock was featured in this week's IPO Leaders story. Remember, buying stocks during a stock market correction is very risky, but the stock is showing a tremendous amount of strength in a down market.
Tesla Stock Slams The Brakes
Tesla stock skidded as much as 14% to 669 Thursday after Tesla registrations in China slowed considerably due to the spreading coronavirus. Tesla shares pared their losses to about 10% midday.Shares hit their lowest level since Feb. 3 and are about 27% off their all-time high set on Feb. 4 at 968.99.
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