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U.S. equities ended sharply lower on Tuesday, dragging the three major benchmarks to their lowest levels in about two weeks. Wall Street’s decline for a second day this week was a big blow to investors as they witnessed a sharp decline in both U.S. oil prices and shares of technology giants. Although the Senate passed a $484 billion coronavirus relief agreement on Apr 21, the historic drop in oil prices took a toll on investors’ hopes.
The three major indices — the Dow Jones Industrial Average, S&P 500 and Nasdaq Composite — closed in the red on Tuesday. The Dow Jones Industrial Average closed at 23,018.88 after losing 2.7%, the broader S&P 500 reached 2,736.56 after declining 3.1% and the tech-laden Nasdaq Composite hit 8,263.23 after decreasing 3.5%.
The fear-gauge CBOE Volatility Index (VIX) declined 3.1% to close at 44.01 on Apr 21. Finally, decliners outnumbered advancers on the NYSE by a 4.27-to-1 ratio.
Oil Prices Plunge
On Apr 21, West Texas Intermediate crude for June delivery declined 43.4% to $11.57 a barrel. This sharp decline in June contract of WTI came a day after the May contract (expired on Apr 21) fell into negative territory.
In fact, the slump in oil prices promoted President Donald Trump to instruct the Energy and Treasury departments to formulate a plan to provide financial aid to the oil and gas industry “so these very important companies and jobs will be secured long into the future.”
Tech Giants Face Strong Sell-Off
The steep losses in tech-laden Nasdaq Composite and the S&P 500’s Technology Select Sector SPDR Fund (XLK) which shed 4.2% on Tuesday were also a result of the sharp sell-off of technology stocks.
A reason for this sell-off could be Trump’s temporary ban on immigration into the United States, which is likely to impact technology companies. Second, shares of Alphabet Inc. (GOOGL - Free Report) and Facebook, Inc. shed 3.9% and 4.2% respectively on Apr 21because of decline in online advertising sales.
Senate Passes Coronavirus Relief Agreement
On Apr 21, the Senate finally reached a bill to pass a $484 billion relief package that aims to aid small businesses, hospitals and testing. The agreement allocates $320 billion to the Paycheck Protection Program, out of which $60 billion would be provided to small institutions. Another $60 billion would be allocated to the Economic Injury Disaster Loan Program, out of which $10 billion will be in the form of grants.
The bill approves $75 billion for hospitals and $25 billion for coronavirus testing. Out of the $25 billion for testing, $11 billion would be available to states. Rest of the funds would go to agencies such as the National Institutes of Health and Centers for Disease Control and Prevention. In addition, up to $1 billion may be used to pay for testing of those without insurance coverage.
Mixed Earnings Picture in View
Shares of Netflix, Inc. (NFLX - Free Report) dropped 0.8% reported first-quarter 2020 earnings of $1.57 per share, which missed the Zacks Consensus Estimate by 2.5%. However, on a year over year basis, the figure jumped 106.6%.
The revenues of the streaming giant for the quarter ended March 2020 were impressive as well, since revenues of $5.77 billion rose 27.6% on a year over year basis and surpassed the consensus mark of $5.70 billion. The strong revenues are indicative of the company’s solid subscriber growth in the first quarter as more and more people were forced to stay at home because of the pandemic. (Read more)
Shares of HCA Healthcare, Inc. (HCA - Free Report) , a health care services company, declined 4.5%after the company reported quarterly earnings of $2.33 per share, which missed the Zacks Consensus Estimate of $2.61. Revenues of HCA Healthcare, which belongs to the Zacks Medical - Hospital industry, were reported at $12.86 billion for the quarter ended March 2020 also missed the Zacks Consensus Estimate by 1.3%. (Read more)
Palo Alto Networks (PANW - Free Report) recently announced that it has completed the acquisition of CloudGenix, a software-defined wide area network (SD-WAN) provider. (Read more)
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
Image: Bigstock
Stock Market News for Apr 22, 2020
U.S. equities ended sharply lower on Tuesday, dragging the three major benchmarks to their lowest levels in about two weeks. Wall Street’s decline for a second day this week was a big blow to investors as they witnessed a sharp decline in both U.S. oil prices and shares of technology giants. Although the Senate passed a $484 billion coronavirus relief agreement on Apr 21, the historic drop in oil prices took a toll on investors’ hopes.
The three major indices — the Dow Jones Industrial Average, S&P 500 and Nasdaq Composite — closed in the red on Tuesday. The Dow Jones Industrial Average closed at 23,018.88 after losing 2.7%, the broader S&P 500 reached 2,736.56 after declining 3.1% and the tech-laden Nasdaq Composite hit 8,263.23 after decreasing 3.5%.
The fear-gauge CBOE Volatility Index (VIX) declined 3.1% to close at 44.01 on Apr 21. Finally, decliners outnumbered advancers on the NYSE by a 4.27-to-1 ratio.
Oil Prices Plunge
On Apr 21, West Texas Intermediate crude for June delivery declined 43.4% to $11.57 a barrel. This sharp decline in June contract of WTI came a day after the May contract (expired on Apr 21) fell into negative territory.
In fact, the slump in oil prices promoted President Donald Trump to instruct the Energy and Treasury departments to formulate a plan to provide financial aid to the oil and gas industry “so these very important companies and jobs will be secured long into the future.”
Tech Giants Face Strong Sell-Off
The steep losses in tech-laden Nasdaq Composite and the S&P 500’s Technology Select Sector SPDR Fund (XLK) which shed 4.2% on Tuesday were also a result of the sharp sell-off of technology stocks.
A reason for this sell-off could be Trump’s temporary ban on immigration into the United States, which is likely to impact technology companies. Second, shares of Alphabet Inc. (GOOGL - Free Report) and Facebook, Inc. shed 3.9% and 4.2% respectively on Apr 21because of decline in online advertising sales.
Senate Passes Coronavirus Relief Agreement
On Apr 21, the Senate finally reached a bill to pass a $484 billion relief package that aims to aid small businesses, hospitals and testing. The agreement allocates $320 billion to the Paycheck Protection Program, out of which $60 billion would be provided to small institutions. Another $60 billion would be allocated to the Economic Injury Disaster Loan Program, out of which $10 billion will be in the form of grants.
The bill approves $75 billion for hospitals and $25 billion for coronavirus testing. Out of the $25 billion for testing, $11 billion would be available to states. Rest of the funds would go to agencies such as the National Institutes of Health and Centers for Disease Control and Prevention. In addition, up to $1 billion may be used to pay for testing of those without insurance coverage.
Mixed Earnings Picture in View
Shares of Netflix, Inc. (NFLX - Free Report) dropped 0.8% reported first-quarter 2020 earnings of $1.57 per share, which missed the Zacks Consensus Estimate by 2.5%. However, on a year over year basis, the figure jumped 106.6%.
The revenues of the streaming giant for the quarter ended March 2020 were impressive as well, since revenues of $5.77 billion rose 27.6% on a year over year basis and surpassed the consensus mark of $5.70 billion. The strong revenues are indicative of the company’s solid subscriber growth in the first quarter as more and more people were forced to stay at home because of the pandemic. (Read more)
Shares of HCA Healthcare, Inc. (HCA - Free Report) , a health care services company, declined 4.5%after the company reported quarterly earnings of $2.33 per share, which missed the Zacks Consensus Estimate of $2.61. Revenues of HCA Healthcare, which belongs to the Zacks Medical - Hospital industry, were reported at $12.86 billion for the quarter ended March 2020 also missed the Zacks Consensus Estimate by 1.3%. (Read more)
Netflix carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Stocks That Made Headlines
Palo Alto Networks Closes CloudGenix Buyout Deal
Palo Alto Networks (PANW - Free Report) recently announced that it has completed the acquisition of CloudGenix, a software-defined wide area network (SD-WAN) provider. (Read more)
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
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