Wall Street falls on virus concerns, Amazon limits losses

Andrew Cummings
February 2, 2020

Exxon and Chevron both fell after issuing fourth-quarter results. It measures the daily stock price movements of 30 large, publicly-owned US companies. The inverted yield curve, considered a precursor to a recession, is widening in the U.S.as yields on short-term government bonds soar above benchmark 10-year yields. Demand for Treasurys pushed the yield on the 10-year note to 1.521%, nearing 2016's record low, while gold prices hovered near the highest level in nearly seven years.

The Dow Jones Industrial Average skidded more than 600 points and the S&P 500 index erased its gains for January.

Looking at earnings, Amazon's market capitalization reclaimed the $1 trillion level early in the session after the e-commerce giant reported earnings and revenue that were well ahead of expectations.

After suffering its biggest one-day percentage decline since October 2, the S&P 500 .SPX is down more than 3% from its closing high hit earlier in January, as businesses struggle with supply problems from the coronavirus epidemic that has killed 213 people in China and been declared a global emergency. That designation signals that the virus is now a significant risk to other countries and requires a global response.

Gold fell 60 cents to $1,582.90 per ounce, silver rose 2 cents to $17.97 per ounce and copper was unchanged at $2.52 per pound, but it's down 6.4% for the week. The stock was down 2.97 percent.

The S&P index recorded 33 new 52-week highs and 12 new lows, while the Nasdaq recorded 45 new highs and 99 new lows.

In Europe, Britain's FTSE tumbled 1.4 percent ahead of the United Kingdom's exit from the European Union. Indexes in mainland China open on Monday after an extended shutdown of more than a week for the Lunar New Year.

The potential effects of the virus darkened the outlook at a time when many investors had been encouraged by progress on trade between two of the biggest world economies, along with three interest rate cuts by the Federal Reserve. The death toll stood at 213, including 43 new fatalities, all in China. The S&P and NASDAQ had their worst start to the year in 5 years. The Nasdaq Composite held onto its 2 percent gain for 2020. Analysts have said that Prime subscribers, who pay $119 a year for faster shipping and other perks, typically spend more of their money at Amazon than at other retailers.

RECOMPUTING: IBM climbed 4.4% after the technology company said it is changing leadership and putting a cloud computing leader at the helm. Arvind Krishna, head of IBM's cloud unit and a key architect of the company's Red Hat acquisition, will be Rometty's replacement. Cloud computing has become an increasingly important part of the company's operations and is a highly competitive area.

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