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Rabu, 11 Maret 2020

Here We Go Again: Dow Drops 880 Points As Stock Market Turmoil Continues - NPR

The stock market has continued to be volatile in recent weeks over growing fears that the spread of coronavirus will push the world economy into recession. Timothy A. Clary/AFP via Getty Images hide caption

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Timothy A. Clary/AFP via Getty Images

Updated at 12:32 p.m. ET

The Dow Jones Industrial Average fell sharply yet again Wednesday morning after staging a rally a day earlier. Just on Monday the stock market had its worst drop since 2008 amid fears that the growing spread of coronavirus would push the global economy into recession.

The blue chip index was down more than 880 points, or 3.5%, in midday trading. The S&P 500 and the Nasdaq were down about 3%.

Early Monday afternoon, the World Health Organization declared that the disease COVID-19, caused by coronavirus, is a pandemic. As of Tuesday, the WHO was reporting 142,823 cases in 109 countries on six continents.

The Dow rose 1,167 points, or 4.9%, on Tuesday — a partial rebound from Monday's more than 2,000-point drop, which was a stunning loss of about 7.8%.

The airline industry has been one of the hardest hit by the coronavirus, as people and businesses cancel travel plans. In an interview with NPR's Peter O'Dowd on Wednesday, JetBlue CEO Robin Hayes compared the impact to the aftermath of the Sept. 11, 2001, attacks.

"I would say we're in the middle of a very significant impact, some would say devastating impact, to the airline industry," Hayes said. "There were lots of concerns just after 9/11 about flying. And we're really seeing the same now with the coronavirus."

But he said the industry is better able to withstand the economic shock than it was during the financial crisis. "It's pretty healthy. We've all built stronger balance sheets. We've all got good liquidity. And so I think the economic backdrop for airlines is very different," Hayes said.

The Federal Reserve and other central banks have been cutting interest rates, and the U.S. and other governments have been rolling out aid and stimulus proposals to help cushion the economic blow of the outbreak.

The Bank of England was the latest central bank to lower rates, announcing an emergency 0.5-percentage-point cut on Wednesday. It said the cut "will help to support business and consumer confidence at a difficult time, to bolster the cash flows of businesses and households, and to reduce the cost, and to improve the availability, of finance."

Oil prices, which can reflect economic demand, have also been volatile after Saudi Arabia unexpectedly decided to slash its prices for crude last weekend. The price of Brent, a global benchmark, was down more than 2% Wednesday. It has fallen 27% over the past five trading days.

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2020-03-11 16:32:47Z
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PepsiCo to buy energy drink maker Rockstar for $3.85bn - Financial Times

PepsiCo is seeking to boost its presence in the fast-growing energy drinks category, announcing it will buy Rockstar Energy Beverages for $3.85bn.

The deal reflects the trend among big beverage companies like PepsiCo and Coca-Cola to overhaul their portfolios to shift their reliance on sales of sugary, fizzy drinks and towards options ranging from tea and coffee to water of both still and sparkling varieties, which appeal to health-conscious and millennial consumers.

Neither PepsiCo nor Coca-Cola own a major brand in the energy drinks category, which is forecast to grow to more than $80bn over the next five years, and is currently dominated by Red Bull.

Ramon Laguarta, PepsiCo chief executive, described the acquisition as “highly strategic” and said it would allow the company to “both accelerate Rockstar’s performance and unlock our ability to expand in the category with existing brands such as Mountain Dew.”

The deal would mark one of the first big moves for Mr Laguarta, who took the reins from Indra Nooyi in 2018, and comes at a time when sharp moves in financial markets have prompted investors and bankers to rapidly reassess the outlook for merger and acquisition activity.

PepsiCo shares were down 3.8 per cent in pre-market trading on Wednesday, slightly worse off than the 3.4 per cent drop for the S&P 500 that was implied by futures as investors continue to grapple with volatility amid the coronavirus outbreak and following Monday’s oil price plunge.

PepsiCo has distributed Rockstar in North America since 2009. Its own stable of energy drinks is limited to Mountain Dew Kickstart, GameFuel and AMP. Coca-Cola owns a stake in Monster Beverage, and had a distribution agreement with the company that, until an arbitration ruling last year, meant it could not sell its own Coke-branded energy drinks in the US.

In February, PepsiCo said it would buy Hangzhou Haomusi Food, also known as Be & Cheery, one of the largest online snacks companies in China, for $705m, which it said at the time represented “an important step” in its goal to become China’s leading consumer-centric food and beverage company.

PepsiCo said in a statement on Wednesday it did not expect the transaction, which is subject to the usual customary closing conditions and approvals, to be material to its revenue or earnings in 2020. The deal is expected to close in the first half of this year.

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2020-03-11 16:36:30Z
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Here We Go Again: Dow Drops 1000 Points As Stock Market Turmoil Continues - NPR

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The stock market has continued to be volatile in recent weeks over growing fears that the coronavirus epidemic will push the world economy into recession. Timothy A. Clary/AFP via Getty Images hide caption

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Timothy A. Clary/AFP via Getty Images

Updated at 12:15 p.m. ET

The Dow Jones Industrial Average fell sharply yet again Wednesday morning after staging a rally a day earlier. Just on Monday the stock market had its worst drop since 2008 amid fears that the growing coronavirus epidemic would push the global economy into recession.

The blue chip index was down more than 880 points, or 3.5%, in midday trading. The S&P 500 and the Nasdaq were down about 3%.

The Dow rose 1,167 points, or 4.9%, on Tuesday — a partial rebound from Monday's more than 2,000-point drop, which was a stunning loss of about 7.8%.

The airline industry has been one of the hardest hit by the coronavirus epidemic, as people and businesses cancel travel plans. In an interview with NPR's Peter O'Dowd on Wednesday, JetBlue CEO Robin Hayes compared the impact to the aftermath of the Sept. 11, 2001, attacks.

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Stocks fall as U.S. virus response disappoints investors - Reuters

LONDON (Reuters) - European stocks rose on Wednesday after the Bank of England joined other central banks in cutting interest rates, raising hopes for more co-ordinated monetary and fiscal stimulus to counter the economic shock from the coronavirus outbreak.

File Photo: A street cleaning operative walks past the London Stock Exchange Group building in the City of London financial district, whilst British stocks tumble as investors fear that the coronavirus outbreak could stall the global economy, in London, Britain, March 9, 2020. REUTERS/Toby Melville

The surprise move from the BoE which - on the day that Britain’s budget is set to open the taps on spending - also announced measures to support bank lending, lifted shares after a lacklustre session in Asia.

Wall Street had rallied significantly on Tuesday, helping reverse some of Monday’s brutal losses, but that failed to translate into improved sentiment on Wednesday as scepticism grew about the stimulus package announced by Washington to fight the epidemic.

By 0855 GMT, the FTSE 100 had risen 1.73%, the Euro Stoxx was 2.67% ahead and Germany’s DAX was 2.65% higher.

U.S. stock futures were down 1.2%, although that was up from the 3% losses before the BoE’s 50-basis-point cut in the base rate to 0.25%. MSCI’s broadest index of Asia-Pacific shares outside Japan fell 1.05%.

With the Federal Reserve having already cut rates this month, the pressure is on the European Central Bank to act when it meets on Thursday.

The BoE did not announce any new quantitative easing but it did launch a new scheme to support lending to small businesses. The UK finance minister is due to present his first annual budget shortly after 1230 GMT.

“It is the only thing central banks can do in a public health crisis,” Neil Dwane global strategist and portfolio manager at Allianz Global Investors. “They are trying to take the shackles off the banks to ensure we don’t get a cash crunch.”

Still, after a decade of extraordinary monetary policy, investors say the impact of easier policy has clear limits, and increased government spending must bear the brunt of the policy response to the economic consequences of the outbreak.

“For the ECB their problem is that there is even more pressure because they face the third largest euro zone economy - Italy - in dire straits,” Dwane said.

As of Tuesday’s close, $8.1 trillion in value has been erased from global stock markets in the recent rout.

The MSCI all-country index has lost more than 15% of its value since it peaked on Feb. 12. It was unchanged in early trading on Wednesday.

(Graphic: Markets hit hard by coronavirus worries - here)

DECLINING DOLLAR

Sterling initially fell following the BoE decision before rebounding. It was last up 0.5% at $1.2945 and flat versus the euro at 87.49 pence.

The dollar resumed its decline against the yen, the Swiss franc and the euro, weighed by uncertainty about the U.S government’s response and the drop in U.S. Treasury yields, although the greenback remained significantly above levels seen on Monday.

The euro rose 0.3% versus the U.S. currency to $1.1315.

Benchmark U.S. 10-year Treasury yields fell 4 basis points to 0.7129%, more than double Monday’s record low yield of 0.3180%.

Market participants largely expect the Fed to cut interest rates for the second time this month at the conclusion of next week’s regularly scheduled policy meeting, after it surprised investors last week with a 50-basis-point cut. [FEDWATCH]

German government bond yields rose after the BoE cut improved sentiment, while Italian yields - which had shot up on worries the country on the front line Europe’s virus outbreak is sliding into a recession - fell as bets on ECB stimulus grow.

Italy is on lockdown in an attempt to slow new infections.

Karen Ward, Chief Market Strategist for EMEA at JP Morgan Asset Management, said all eyes were now on the UK finance minister to see if he announces a big increase in spending.

“If he does this would be the first instance of a truly coordinated monetary and fiscal push. Investors may be comforted by the fact that policymakers are willing to deploy their full ammunition - moving a step closer to helicopter money,” she said.

U.S. crude reversed earlier gains and dropped 0.7% to $34.23 per barrel, while Brent crude slipped 0.21% to $37.14 after Saudi Aramco said it had been directed by the energy ministry to raise its production capacity.

On Monday, the oil market plunged with futures recording their largest percentage drop since the 1991 Gulf War as Saudi Arabia and Russia clashed openly over management of supply.

Spot gold, which is often bought as a safe-haven during times of uncertainty, rose 0.54% to $1,657 per ounce. [GOL/]

Additional reporting by Marc Jones in London and Stanley White in Tokyo; editing by John Stonestreet

Our Standards:The Thomson Reuters Trust Principles.

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2020-03-11 14:55:09Z
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Wall Street slumps at open as investors wary of U.S. response to virus - Investing.com

© Reuters. A trader works on the floor of the New York Stock Exchange (NYSE) in New York City, New York

(Reuters) - U.S. stock indexes fell sharply at the open on Wednesday as investors were skeptical about President Donald Trump's stimulus plan to combat the coronavirus epidemic.

The Dow Jones Industrial Average () fell 413.53 points, or 1.65%, at the open to 24,604.63 and the S&P 500 () opened lower by 56.63 points, or 1.96%, at 2,825.60.

The Nasdaq Composite () dropped 208.01 points, or 2.49%, to 8,136.25 at the opening bell.

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2020-03-11 13:54:19Z
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Here We Go Again: Dow Drops 800 Points As Stock Market Turmoil Continues - NPR

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The stock market has continued to be volatile in in recent weeks over growing fears that the coronavirus epidemic will push the world economy into recession. Timothy A. Clary/AFP via Getty Images hide caption

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Timothy A. Clary/AFP via Getty Images

Updated at 10:01 a.m. ET

The Dow Jones Industrial Average fell yet again Wednesday morning after staging a rally a day earlier. Just on Monday, the stock market had its worse drop since 2008 amid fears that the growing coronavirus epidemic would push the global economy into recession.

The blue chip index was down more than 800 points, or 3.2%, Wednesday morning. The S&P 500 and the Nasdaq were down more than 2.5%.

The Dow rose 1,167 points, or 4.9%, on Tuesday — a partial rebound from Monday's more than 2,000-point drop, which was a stunning loss of about 7.8%.

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Stock futures fall as investors seek stimulus to combat virus spread - Reuters

A trader works on the floor of the New York Stock Exchange (NYSE) in New York City, New York, U.S., March 10, 2020. REUTERS/Andrew Kelly

(Reuters) - U.S. stock index futures were down 2% on Wednesday after strong gains in the previous session, with investors growing frustrated about the lack of details on fiscal stimulus floated by President Donald Trump to combat the coronavirus epidemic.

Wall Street jumped nearly 5% on Tuesday, driven by expectations that Trump would discuss a payroll tax cut and announce other “major” stimulus measures at a news conference.

While Trump met with fellow Republicans in the U.S. Senate on Tuesday, he did not outline any steps to bolster domestic economic growth.

Any plan the White House introduces will need to be approved by both houses of the U.S. Congress.

Futures also shrugged off a surprise move by the Bank of England to cut interest rates and support bank lending, which had lifted sentiment in Europe and Asia overnight. [MKTS/GLOB]

At 6:31 a.m. ET, Dow e-minis 1YMcv1 were down 526 points, or 2.12%. S&P 500 e-minis EScv1 were down 66 points, or 2.3% and Nasdaq 100 e-minis NQcv1 were down 187 points, or 2.24%.

The three main indexes came within a hair's breadth of confirming bear market territory, implying a drop of 20% from record highs, on Monday following a collapse in oil prices. The S&P 500 .SPX is now about 15% below its all-time high hit just three weeks earlier.

Reporting by Medha Singh in Bengaluru; Editing by Shounak Dasgupta

Our Standards:The Thomson Reuters Trust Principles.

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2020-03-11 13:06:02Z
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