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Selasa, 24 Maret 2020

Dow futures surge to hit 5% daily limit as Wall Street holds out hope for coronavirus rescue plan - MarketWatch

How are benchmarks performing?

The Dow Jones Industrial Average DJIA, +7.29% rose 1,366 points, a rise of 7.5%, to reach 19,957, the S&P 500 index SPX, +6.39% advanced 141 points, or 6.3%, to trade at 2,379 and the Nasdaq Composite index COMP, +5.78% gained 402 points, or 5.8%, at 7,262.

On Monday, the Dow tumbled 582.05 points, or 3%, to settle at 18,591.93, its lowest reading since Nov. 9, 2016, the day of President Donald Trump’s election. The S&P 500 slipped 67.52 points, or 2.9%, to close at 2,237.40 points. The Nasdaq Composite Index shed 18.84 points, or 0.3%, to end at 6,860.67.

What’s driving the market?

U.S. lawmakers inched toward an agreement on a roughly $2 trillion coronavirus rescue package, according to a report by the Washington Post, helping to reignite the buying appetite on Wall Street for the moment, after lawmakers on Monday twice failed to reach an agreement, sending stocks into a fresh tailspin.

Senate Minority Leader Chuck Schumer said from the Senate floor that he had “very good” discussions with U.S. Treasury Secretary Steven Mnuchin, who is leading the talks on the Republican side, and that the list of outstanding issues has narrowed “significantly.”

“Political fighting in the US has prevented a stimulus scheme from being revealed earlier, but dealers are optimistic nonetheless,” wrote David Madden, market analyst at CMC Markets UK, in a daily note.

Losses on Monday came even after the Federal Reserve unfurled its most potent batch of stimulus measures to date, saying it would buy an unlimited amount of Treasurys and mortgage-backed securities, among other measures, to stem the harm from the virus and unlock seized up areas of financial markets.

Markets across the globe have been reeling from planned, temporary business shutdowns, including that of Spain, the U.K., and Italy, to mitigate the spread of COVID-19, the infectious disease that is derived from a novel strain of coronavirus, and which has infected 390,000 people globally since it was first identified in December.

The intentional lockdowns are expected to drive much of the world, including the U.S., into a recession.

However, President Donald Trump on Tuesday has floated the idea of restarting the economy soon to limit the damage to small and medium-size businesses, a notion that has run against the advice of his coterie of health advisers. That idea may partly be heartening some staunch stock-market bulls, despite the implications of more rapid spread of the illness and a higher death toll.

Meanwhile, reports that the outbreak was peaking in Europe also offered some glimmers of hope for market bulls. Indeed, both new cases and deaths have dropped for two days in Italy, and the head of Germany’s public health institute said the infections rate in Europe’s largest economy was leveling off.

Also read:Goldman Sachs says it is time to buy gold — the ‘currency of last resort’

“Sensibly, investors are now actively seeking these ‘new world’ sectors and companies in order to grow and protect their wealth.,” wrote Nigel Green, chief executive of deVere Group, an independent financial advisory firm, in a Tuesday note.

Looking ahead, in economic reports, the IHS Markit releases its U.S. Purchasing Managers’ Index for March at 9:45 a.m. Eastern Time. Expectations are for a 49 reading, down from February’s 49.6 figure. After that, the new residential home sales for February are due at 10 a.m. Economists forecast a seasonally adjusted annual rate of 740,000 homes sold. That estimate would be down 3.1% from January’s 764,000 rate.

Which stocks are in focus?

Phillips 66 PSX, +4.93% Shares ofcould be in focus on Tuesday after the oil company said that it secured a $1 billion term loan, cut its capital expenditures for 2020 and temporarily suspended share buybacks.
CVX, +19.05% Chevron Corp.’s shares also could be in focus after the oil giant said it would cut its 2020 capex by $4 billion and temporarily halt share repurchases.
MU, +9.16% Micron Technology Inc. is scheduled to report fiscal second-quarter earnings after the bell on Wednesday.
NKE, +8.34% Nike is slated to report quarterly results on Tuesday.
MA, +16.07% Mastercard Inc. revised down its revenue forecast for the first quarter.
GM, +11.19% General Motors Co.’s said it is planning to draw down about $16 billion from its revolving credit facility.
INTC, +5.86% Intel Corp. shares rose, despite the company announcing it would suspend its share repurchase program.

How are other markets trading?

In bond markets, the yield on the 10-year U.S. Treasury note TMUBMUSD10Y, 0.845% rose about 10 basis points, to 0.85%.

Crude oil rose, with the price of a barrel of West Texas Intermediate crude CL.1, +0.17% up 99 cents, or 4.2% to $24.34. In precious metals, gold GCJ20, +6.01% surged by about $108, or 6.9% to trade at 1,676.60 an ounce.

European stocks were in rally mode, as the Stoxx Europe 600 SXXP, +5.28% gained 4.9%.

In Asia overnight, stocks closed higher, with the China CSI 300 000300, +2.68% up 2.7%, Hong Kong’s Hang Seng index HSI, +4.45% adding 4.5% and Japan’s Nikkei 225 NIK, +7.13% ending the session 7.1% higher.

The U.S. dollar traded lower, compared to a basket of its major peers. The ICE U.S. dollar index DXY, -0.79% was down 0.8%.

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2020-03-24 13:48:46Z
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CVS plans to hire furloughed workers from its customers as companies get creative during coronavirus pandemic - MarketWatch

The coronavirus that causes COVID-19 has led many companies to lay off or furlough workers, temporarily close stores and offices and shut down production, but has also inspired some to become creative in their handling of the crisis.

CVS Health CVS, -2.94%, for example, said Monday it is embarking on one of the most ambitious hiring drives in its history with plans to hire 50,000 full-time, part-time and temporary workers—and it has decided to tap directly into its customers’ workforces by taking on furloughed workers from the Marriott MAR, -5.96% and Hilton HLT, +2.80% hotel chains.

The drugstore chain said it would use a “technology-enabled hiring process that includes virtual job fairs, virtual interviews and virtual job tryouts.”

Taking on furloughed workers from its own customers will likely speed up the hiring process as those workers will have had background checks and met other requirements that employers seek.

“I think it’s a great idea,” said Andy Challenger, senior vice president of outplacement firm Challenger, Gray & Christmas. “Hopefully, when demand for hotels returns, they can be transitioned back. It gets into the question of what is the best way to get through this from a labor market standpoint.”

During the 2008 financial crisis, many American workers lost their jobs and it took a full eight years to get them back into the economy, he said. ”If this can become a more seamless way to keep people in wages, it could be a positive turn for the economy.”

Read now:Amazon is hiring 100,000 workers, Walmart is hiring 150,000 — here are the sectors adding jobs amid coronavirus

Then there’s Washington Prime Group Inc. WPG, -6.03%, a mall real-estate investment Trust, that said Monday it is temporarily closing indoor malls, but has a novel idea for local governments and agencies. The company is offering to use all of its open air malls to serve as distribution centers for emergency medical supplies, for COVID-19 testing and for food depository stations.

Read; ADP to send employees $1,000 in April

“Our company is basically comprised of over one hundred distinctly local venues,” Chief Executive Lou Conforti wrote in a letter directed to local and state government agencies, excerpts of which were released on Monday.

“Each and every one serves a specific demographic constituency and shame on us if ‘serve’ is exclusively defined as the sale of a good or service. We characterize our assets as town centers and especially in a time of need this sure as heck transcends footwear, cosmetics or a lamp.”

The company is offering local public school districts the space to distribute free breakfast and lunch to children 18 and under. It is also working with its restaurant tenants to start offering meals to health care workers and other first responders.

For daily coverage of the virus, see:Coronavirus update: 350,536 cases, 15,328 deaths, NYC’s outbreak comes into focus

Weight loss and nutrition company Jenny Craig, which is owned by private-equity firm H.I.G. Capital, is addressing the crisis by adopting phone coaching for clients and curbside meal delivery.

The company’s more than 500 owned and franchised locations are closed to prevent the spread of the virus, but most are still operating by phone, the company said. The company is also offering home delivery options, including for customers who use Walgreens WBA, -6.05% as pickup centers for meals.

Others are ramping up production of needed equipment. 3M Co. MMM, -5.62%, for example, has doubled global production of N95 respirators to a rate of nearly 100 million a month, or more than 1.1 billion a year, to arm health care workers, Chief Executive Mike Roman said on Sunday. In the U.S., the company is producing 35 million respirators a month, with more than 90% being designated for health care workers, and the rest to other critical sectors, such as energy, food and pharmaceutical companies, Roman said in a statement.

“As a global company, we also manufacture respirators in Europe, Asia and Latin America, and our products are being similarly deployed to support the COVID-19 response in those respective regions,” he said.

3M is expecting to nearly double its capacity again within the next 12 months and is working with the U.S. and other governments to explore alternative manufacturing scenarios and cooperation with other companies to accelerate the process.

“We’ve also maximized production of a wide range of other solutions being used in the response, including hand sanitizers and disinfectants,” said Roman.

Honeywell Inc. HON, -7.68% has said it too is increasing production of face masks. GE GE, -6.28% has ramped up production of ventilators and Coty COTY, +14.95% has switched some production to make hand sanitizers.

The car companies, General Motors Co. GM, -2.97%, Ford Motor Co. F, -7.39% and Tesla Inc. TSLA, +1.58%, have said they are considering shifting production away from cars to make needed ventilators, although it is unclear how quickly that might happen.

Companies are also tapping credit lines, cutting costs, suspending dividend and share buyback programs and ordering employees to work from home.

See: In the emergency room, scarcity of protective equipment ‘has been the biggest issue,’ says ER doctor

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2020-03-24 12:58:00Z
52780683399502

Dollar Rally Loses Steam After Fed Move Buoys Risk Appetite - Bloomberg

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2020-03-24 11:23:37Z
52780685065519

Dollar Rally Loses Steam After Fed Move Buoys Risk Appetite - Bloomberg

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Asian stocks rebound, Fed soothes with boundless QE - Reuters

LONDON (Reuters) - Global equities rebounded almost 2% on Tuesday, off near four-year lows, and the dollar slipped as investors pinned hopes on unprecedented stimulus steps by the U.S Federal Reserve and other policymakers to ease strains in financial markets.

While the measures such as the Fed’s offer of unlimited bond-buying won’t immediately mitigate the economic devastation inflicted by the coronavirus outbreak, they will launch more dollars into world markets, allowing companies, funds and banks to access cash to pay creditors, supplier and end-investors.

The prospect had not cheered Wall Street for very long on Monday, with losses of 2-3% on major indexes, but the mood improved on Tuesday, possibly as many other central banks and governments looked set to join the fray. Wall Street futures pointed to stocks opening 4% higher, while a pan-European equity index also rallied a similar amount.

“Today there is a strong recovery connected to the move that the Fed has introduced this massive weapon,” said Francois Savary, CIO of wealth manager Prime Partners, noting the Fed had needed to resolve funding markets seize-ups as a priority.

“The key issue at the end of the day is that we need to deal with a credit markets that is completely closed. First they needed to stop this increase in bond yields... second, they needed to make sure that there is a return of liquidity in the credit then it will be equities - in that sequence.”

The Fed will not only buy unlimited amounts of assets but also expand its mandate to corporate and municipal bonds and backstop a series of other measures that analysts estimate will deliver $4 trillion-plus in loans to non-financial firms.

There were also signs of progress in Congress on a $2 trillion U.S. stimulus deal, which Treasury Secretary Steven Mnuchin hoped was “very close”.

Other countries are unveiling their own measures - South Korea’s ravaged market climbed 8.6% after the government doubled a planned economic rescue package to 100 trillion won ($80 billion).

In China, mainland stocks posted their biggest gain in three weeks with a rise of almost 3% while Japan’s Nikkei soared 7%, its biggest daily rise since Feb 2016.

Not everyone was optimistic the buoyant mood would last noting, for instance, that global coronavirus infections now top 350,000 with scores of countries in lockdown. China too posted a rise in new infections brought in from abroad.

(Graphic: China's coronavirus cases JPG, here)

“Markets are continuing to bounce up on the latest policy announcements and then sliding back down as the economic reality of the situation re-emerges,” Deutsche Bank strategist Jim Reid said.

Still, the plan calmed nerves in bond markets, where yields on two-year Treasuries hit their lowest since 2013. Ten-year yields were at 0.8339%, from last week’s peak of 1.28%. Yields inched higher on Tuesday as equities rallied.

ALL ABOUT THE ECONOMY

Just how much the virus is ravaging the global economy is evident in a series of growth forecast downgrades and advance readings of purchasing managers indexes (PMI) across the world’s biggest economies.

German activity plunged to the lowest since the 2009 crisis, driven by a record services contraction, while French activity hit all-time lows. Japan posted its biggest-ever services decline.

“Economies around the world are going offline and that is devastating for economic activity, it’s creating the most robust dislocation in financial markets in living memory,” said George Boubouras, head of research at K2 Asset Management in Melbourne.

For now however, the prospect of massive Fed funding pushed the greenback 0.5% lower against rivals, off three-year peaks. It fell similarly to the yen and slumped 1% versus the euro.

Commodity and emerging market currencies also benefited, with the Australian dollar up almost 2% to $0.59315 and well off 17-year lows.

FILE PHOTO: Pedestrians wearing face masks walk near an overpass with an electronic board showing stock information, following an outbreak of the coronavirus disease (COVID-19), at Lujiazui financial district in Shanghai, China March 17, 2020. REUTERS/Aly Song

There was some relief on the market volatility front too. A gauge of expected euro-dollar swings eased below 12%, from above 14% on Monday, and a measure of U.S. equity volatility slipped to one-week lows around 57 points.

(Graphic: Volatility is back on Wall Street png, here)

Reporting by Sujata Rao; Additional reporting by Karin Strohecker in London, Wayne Cole in Syndey and Scott Murdoch in Hong Kong; Editing by Alex Richardson

Our Standards:The Thomson Reuters Trust Principles.

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2020-03-24 10:55:52Z
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U.S. Stock-Index Futures and Global Equities Rise After Fed Move - The Wall Street Journal

Caitlin Ostroff and

Caitlin Ostroff

The Wall Street Journal

Biography
@ceostroff
caitlin.ostroff@wsj.com

Joanne Chiu

The Wall Street Journal

Biography
@joannechiuhk
joanne.chiu@wsj.com

Updated March 24, 2020 6:21 am ET

U.S. stock futures and global equities rose Tuesday, following sharp swings at the start of the week, as investors parsed central bank and government responses to the coronavirus pandemic and its economic fallout.

Futures linked to the S&P 500 index gained about 5%, suggesting U.S. shares could rise when the market opens in New York. European equity indexes climbed, with the pan-continental Stoxx Europe 600 advancing 5. Most Asian markets also closed higher, led by a 7.1% jump in Japan’s Nikkei 225 gauge and an 8.6% rise for South Korea’s key equity benchmark.

A string of emergency measures by the Federal Reserve to support credit markets and ensure funding for American businesses and homeowners has helped alleviate some of the most pressing concerns among investors. At the same time, markets remain sensitive to reports of fresh outbreaks of the virus, and the damage caused to the economy by measures to stem the contagion.

Trading day

All times ET Source:

Still, speculation about the breadth and depth of an impending global recession continue to weigh on investors.

“This is classic bear-market moves,” said David Coombs, head of multiasset investments at Rathbones Investment Management. “It doesn’t feel like there’s massive relief and confidence out there.”

U.S. lawmakers have so far failed to reach an agreement on a more than $1.6 trillion economic rescue package. Concerns about growth prospects have erased more than a third of the value in the S&P 500 index in recent weeks, and left volatility in American stocks at elevated levels.

On Tuesday, March figures for the manufacturing and services sector in Germany and the eurozone pointed to a contraction. Figures for the U.S., due later in the day, are also expected to show a fall.

“It’s an unprecedented medical emergency which requires an unprecedented response from policy makers,” said Florian Hense, an economist at Berenberg. “As we are trying to contain the medical emergency, we are trying to pull down economic activity. We are consciously, voluntarily pulling down economic activity.”

Gold rose about 4%, a move that some investors saw as a return to normalcy in the functioning of financial markets, as the price of the precious metal usually rises in times of uncertainty. Last week, it fell 2.1% as investors, looking to hold cash, divested gold amid a broader selloff in assets across the board.

The WSJ Dollar Index, which tracks the currency against a basket of others, eased 0.9%. On Monday, the gauge hit its highest closing level since 2002. Currencies including the euro, British pound, Swiss franc, Australian dollar and Korean won strengthened against the dollar.

The demand for U.S. government bonds, which are seen as a haven when markets are in turmoil, showed signs of easing. The yield on the 10-year U.S. Treasury, which moves inversely to its price, rose to 0.821%, from 0.763% Monday, according to Tradeweb.

Moves by the Fed and other central banks to keep interest rates low and ensure money was available for corporations is essential to prevent a complete economic meltdown, said David Gaud, Asia chief investment officer and head of discretionary portfolio management at Pictet Wealth Management.

“It’s moving in the right direction but it’s not sufficient,” to support world economies without decisive government action to address the economic fallout as well, he said. He said the longer the pandemic lasts, the greater its economic impact would be, in which case current fiscal and monetary policy responses might prove insufficient.

Japan’s Nikkei 225 closed higher Tuesday.
Photo: kimimasa mayama/Shutterstock/european pressphoto agency

Brent crude, the global oil benchmark for oil, rose 5.1% to $30.78 a barrel. Crude prices have plunged by more than half on worries about reduced demand and a price war between major oil-producing nations.

The global death toll from the novel coronavirus surpassed 16,000, with more than 367,000 confirmed cases. Cases in the U.S. alone grew 10-fold to cross 41,000 from a week earlier, as more state governors ordered residents to stay home. Meanwhile, the U.K. joined other European countries in mandating a lockdown under a raft of restrictions from the government.

Write to Caitlin Ostroff at caitlin.ostroff@wsj.com and Joanne Chiu at joanne.chiu@wsj.com

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2020-03-24 10:27:43Z
CAIiEGJ9rwoneKz6jFjnygFmjlkqGAgEKg8IACoHCAow1tzJATDnyxUwiqe0AQ

Dollar Rally Loses Steam After Fed Move Buoys Risk Appetite - Bloomberg

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Selasa, 24 Maret 2020

How are benchmarks performing?

What’s driving the market?

Which stocks are in focus?

How are other markets trading?

ALL ABOUT THE ECONOMY

Japan’s Nikkei 225 closed higher Tuesday.