- Stocks turned mixed Thursday and the S&P 500 and Nasdaq set all-time intraday highs even after China reported a very large spike in new coronavirus cases.
- Coronavirus update: 1,370 deaths and more than 60,360 infected, with 15 cases confirmed in the United States.
- PepsiCo is Real Money’s Stock of the Day after posting stronger-than-expected fourth-quarter earnings and forecasting solid sales growth for 2020.
Stocks turned mixed Thursday and the S&P 500 and Nasdaq set all-time intraday highs even after China reported a very large spike in new coronavirus cases.
Health officials using computerized tomography techniques confirmed more than 15,000 new cases of the virus – known as Covid-19 – in Hubei province, where the disease was first identified. That boosted the cases in the province to just under 50,000 and China’s nationwide total to around 60,000.
Only two of the 1,370 confirmed deaths from the disease have come from outside of China. But with the new detection methods unveiling a raft of new cases, and World Health Organization Director General Tedros Adhanom Ghebreyesus warning the outbreak “could still go in any direction,” caution has replaced optimism heading into end of the trading week.
A senior administration official told CNBC the United States doesn’t “have high confidence in the information coming out of China” regarding the virus count.
The U.S. confirmed its 15th case of the disease on Thursday.
The Dow Jones Industrial Average fell 36 points, or 0.12%, to 29,514, the S&P 500 was up 0.05% and the Nasdaq rose 0.19%. The three major stock market benchmark indexes closed at record highs on Wednesday.
“The sudden sharp reacceleration in new coronavirus infections in China has investors reassessing risk,” said Alec Young, managing director of global markets research for FTSE Russell. “Given the inherent uncertainty of this macro risk, we believe a focus on the bottom line can be helpful. While China and travel-focused companies are obviously most vulnerable, as long as the economic impact on the U.S. economy remains modest expect U.S. equities to maintain their relative immunity to the virus. Should that firewall begin to break, volatility is likely to increase significantly.”
Tesla , the electric vehicle company, said it would raise $2 billion in new common stock, less than two weeks after founder and CEO Elon Musk said it “didn’t make sense” to raise money.
Tesla said it will use the cash to shore up its balance sheet, as well as for “general corporate purposes.” Tesla said Musk buy about $10 million of stock in the sale, while board member Larry Ellison will purchase $1 million.
Cisco Systems fell Thursday after the networking equipment giant posted modestly stronger-than-expected fiscal second-quarter earnings but said it expects current-quarter revenue to fall 1.5% to 3.5% as global economic uncertainties lead to slowing spending in the technology industry. Cisco was the Dow’s leading laggard Thursday.
PepsiCo posted stronger-than-expected fourth-quarter earnings and forecast solid sales growth for 2020 as snack revenues continues to support the company’s overall top line.
Alibaba posted stronger-than-expected third quarter earnings following a record Singles Day shopping event and after rising cloud computing revenue helped boost profits for Asia’s biggest tech company.
Kraft Heinz’s earnings in the fourth quarter beat analysts’ estimates and the packaged foodmaker said it hopes to make “significant progress” in its ongoing turnaround this year.
This article was originally published by TheStreet.