NEW YORK (AP) —
U.S. stocks fell in midday trading Tuesday after technology giant Apple
became the most well-known company to warn of a financial hit from the
virus outbreak in China.
maker of iPhones said it will fall short of its revenue forecasts in
the fiscal second quarter because production has been curtailed and
consumer demand for iPhones has slowed in China. Apple’s stores there
are are either closed or operating on reduced hours.
Technology stocks led the selling. Apple shed 2.7%. Chipmakers, which also rely heavily on China for sales and supplies, broadly slid. Intel shed 1.9%.
Banks and energy
stocks also fell. HSBC said it will cut 35,000 jobs and shed $100
billion in assets. Its shares dropped 5.6%. Wells Fargo slid 3.4% and
Schlumberger slipped 4.2%.
Bond prices rose. The yield on the 10-year Treasury fell to 1.54% from 1.58% late Friday. Crude oil prices fell 1.1%.
Utilities held up better than most of the market.
SCORE: The S&P 500 index fell 0.7% as of 11:44 a.m. Eastern time.
The Dow Jones Industrial Average fell 270 points, or 0.9%, to 29,121.
The Nasdaq fell 0.5%. The Russell 2000 index of smaller company stocks
fell 0.6%. European and Asian markets fell.
OUTBREAK: The viral outbreak that began in China has now infected more
than 73,000 people and continues to hurt businesses worldwide. The
majority of the cases and deaths remain centered in China.
continue to feel the economic impact from the virus. The Beijing auto
show, the industry’s biggest global event of the year, is being
postponed indefinitely from its April date. Apple is the latest company
to warn investors that the virus will hurt their financial performance.
and health care companies have been the most vocal about mentioning the
new coronavirus in their earnings conference calls, according to
OF BENJAMINS: Financial services company Franklin Resources rose 4.2%
after saying it is buying competitor Legg Mason for $4.5 billion. The
deal will create a financial company with a combined $1.5 trillion in
assets under management. Legg Mason shares rose 23.6%.
AHEAD: Investors face a shortened week because of Monday’s President’s
Day holiday, but there are still several key earnings and economic
reports on tap.
than three-quarters of the S&P 500 has already reported financial
results, and 51 companies are scheduled to release results this week.
Devon Energy and Concho Resources will report their results later
Tuesday. Progressive will report results on Wednesday and ViacomCBS will
report on Thursday.
The government will release its producer price index for January on Wednesday, along with housing starts data.