Stocks open higher on Wall Street a day after a big drop
NEW YORK (AP) — U.S. stocks rose in early trading Tuesday as investors shifted money into technology companies following a broad sell-off a day earlier over fears that the spread of a deadly virus in China could affect the global economy.
Global markets were spooked on Monday by a sharp rise in cases of the coronavirus. China, the world’s second largest economy, is taking increasingly drastic measures to stem the spread of the virus and global health authorities are monitoring the situation.
Apple, which reports earnings later Tuesday, was one of the biggest gainers in the tech sector. Chipmakers including Intel also made solid gains. Many of those companies are sensitive to China’s economic health because they rely on that nation for sales and supply chains.
Banks and other financial companies also climbed, along with communications stocks.
Industrial stocks lagged the market. 3M fell 4.4% after reporting disappointing earnings and planned job cuts.
Bond yields stabilized after a significant drop a day earlier. The yield on the 10-year Treasury rose to 1.63% from %1.60% late Monday.
Wall Street is in the midst of a heavy week for corporate earnings and investors have some key companies to assess. Starbucks will report its results later Tuesday. Boeing, McDonald’s, Facebook and Microsoft will all report results on Wednesday. Other big names reporting this week include Coca-Cola, Amazon, Caterpillar and Exxon Mobil.
KEEPING SCORE: The S&P 500 index rose 0.7% as of 10 a.m. Eastern time. The Dow Jones Industrial Average rose 133 points, or 0.5%, to 28,670. The Nasdaq rose 0.8%. The Russell 2000 index of smaller company stocks rose 0.9%.
OVERSEAS: Markets in Hong Kong, Taiwan and mainland China were closed Tuesday for Lunar New Year holidays. Indexes fell elsewhere, including a 3.1% tumble for South Korea’s benchmark. European markets rose.
VIRUS STATUS: More than 4,500 people have been confirmed ill with the virus and 106 have died in the outbreak of a new coronavirus centered in the Chinese city of Wuhan, an industrial hub along the Yangtze river. The virus has now spread to more than a dozen countries.
Hong Kong has joined much of China in seriously restricting travel by cutting all rail links to the mainland. China's containment efforts began with the suspension of plane, train and bus links to Wuhan and has now expanded to 17 cities with more than 50 million people in the most far-reaching disease-control measures ever imposed.
WEAK DOSE: Pfizer fell 3.3% after the biggest U.S. drugmaker reported disappointing fourth-quarter profits. The company’s revenue fell during the quarter as it continues to slim down and focus on developing new drugs. It moved its huge stable of nonprescription medicines into a new joint venture with GlaxoSmithKline last year.
BUYING PARTS: Auto parts supplier BorgWarner slumped 6% after saying it will buy Delphi Technologies for about $3.3 billion. The deal will help strengthen the company’s power electronic products, but it comes along with a warning to investors about potentially weak sales in 2020, particularly for light and commercial vehicles.
THIN HOG: Harley-Davidson fell 2.1% after the storied motorcycle maker reported weak fourth-quarter earnings and revenue. The company had a tough quarter for U.S. sales, which led the overall worldwide drop.