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S&P 500, Nasdaq reach record closing highs; Chinese workers return

Stock MarketsFeb 10, 2020 04:26PM ET
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© Reuters. Traders work on the floor of the New York Stock Exchange shortly after the opening bell in New York

By Stephen Culp

NEW YORK (Reuters) - The S&P 500 and the Nasdaq closed at record highs on Monday as Chinese workers and factories slowly returned to business following a Lunar New Year holiday that was protracted by the deadly coronavirus outbreak.

All three major U.S. stock averages advanced in a broad-based rally, boosted by index leaders Amazon.com (NASDAQ:AMZN), Microsoft Corp (NASDAQ:MSFT) and Alphabet (NASDAQ:GOOGL) Inc.

Worries over the coronavirus kept market participants on edge, with the death toll rising to 908 and the World Health Organization (WHO) warning that new cases outside of China could be "the spark that becomes a bigger fire."

But generally upbeat earnings, positive economic data and China's recent stimulus have attracted buyers to the U.S. equities market.

"The money that China injected into its economy is finding its way around the world and you have a "buy anything and everything' mentality," said Paul Nolte, portfolio manager at Kingsview Asset Management in Chicago. "It's an index buy and it's growth verses value."

"The U.S. is seeing some economic growth," Nolte added. "We're the cleanest shirt in the dirty laundry, globally, and it gives investors another reason to buy U.S. stocks."

Tesla (NASDAQ:TSLA) Inc's stock rose 3.1% after its Shanghai factory resumed production, and iPhone maker Foxconn re-started a key plant in China with 10% of its workforce.

That is cold comfort for Apple (NASDAQ:AAPL), whose iPhone sales in China could plunge by as much as 50% due to the virus, according to analysts.

The fast-spreading coronavirus has now caused more deaths than the 2002-2003 SARS outbreak, and has affected a broad range of companies and sectors.

The Dow Jones Industrial Average rose 174.31 points, or 0.6%, to 29,276.82, the S&P 500 gained 24.39 points, or 0.73%, to 3,352.1 and the Nasdaq Composite added 107.88 points, or 1.13%, to 9,628.39.

Of the 11 major sectors in the S&P 500 all but energy ended the session in the black, with technology and consumer discretionary shares posting the largest percentage gains.

Fourth-quarter reporting season is approaching the final reel, with 324 of the companies in the S&P 500 having reported. Of those, 70.7% have beat Street estimates, according to Refinitiv data.

Analysts now see aggregate year-on-year fourth-quarter earnings growth of 2.3%, a reversal from the 0.3% decline analysts projected on Jan 1.

Mall operator Taubman Centers Inc jumped 53.2% on news that it would be bought by larger rival Simon Property Group Inc (NYSE:SPG) in a deal valued at $3.6 billion. Simon Property Group's shares inched up 1.4%.

Eli Lilly (NYSE:LLY) dropped 0.6% after experimental Alzheimer's treatments from the U.S. pharmaceutical firm and Switzerland's Roche failed to halt the disease.

Advancing issues outnumbered declining ones on the NYSE by a 1.50-to-1 ratio; on Nasdaq, a 1.46-to-1 ratio favored advancers.

The S&P 500 posted 46 new 52-week highs and 4 new lows; the Nasdaq Composite recorded 105 new highs and 96 new lows.

Volume on U.S. exchanges was 6.60 billion shares, compared with the 7.66 billion average over the last 20 trading days.

S&P 500, Nasdaq reach record closing highs; Chinese workers return
 

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Comments (6)
Cakra Wala
SwordPoint Apr 12, 2021 1:02AM ET
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dolar menguat rupiah melemah
Mats Skon
Mats Skon Feb 10, 2020 4:04PM ET
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As long as Fed keep pumping there is no downside
Fred Smith
Fred Smith Feb 10, 2020 2:38PM ET
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Coronavirus should have no impact on U.S. markets. Overt hyped by media due to Trump impeachment hoax being over. Just a scare tactic drive by story.
Nikhil Kalkundri
Nikhil Kalkundri Feb 10, 2020 10:20AM ET
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hold really?
Nikhil Kalkundri
Nikhil Kalkundri Feb 10, 2020 10:19AM ET
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financial mkts are fraud worldwide....
John doh
John doh Feb 10, 2020 9:08AM ET
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investors weigh down corona risks: It seems shutting down china for 3+ weeks doesn't have enough weight. Something strange is happening in the markets. 50 billion dollar tax a year on Chinese merchandise dropped the market 20% trillion dollar loss over a month to china's GDP didn't stop the market rising 20% I am at a loss to predict the market.
Rodolfo Barraco
Rodolfo Barraco Feb 10, 2020 9:08AM ET
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Buble, buble, hold on tight...
 
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