Dow rallies after best week since 1938

Coronavirus could cause earnings recession: Analyst

CFRA chief investment strategist Sam Stovall on how coronavirus can impact earnings and the markets.

U.S. equity markets gained Monday morning as traders digested the news that social distancing guidelines were extended until at least April 30.

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The Dow Jones Industrial Average climbed more than 320 points, or 1.5 percent. The S&P 500 and Nasdaq Composite were higher by 1.5 and 2 percent, respectively. Last week, the Dow gained 13 percent, making for its best week since 1938.

TickerSecurityLastChangeChange %
I:DJIDOW JONES AVERAGES22023.35+386.57+1.79%
SP500S&P 5002578.73+37.26+1.47%
I:COMPNASDAQ COMPOSITE INDEX7658.366008+155.99+2.08%

Looking at stocks, airlines slid as they awaited the release tens of billions of dollars of aid from the federal government.

Cruise operators remained under pressure after receiving a downgrade from Berenberg Research.

General Motors was in focus after Trump praised the automaker, saying it was doing a “fantastic job” ramping up ventilator production.

TickerSecurityLastChangeChange %
AALAMERICAN AIRLINES GROUP INC.12.37-1.68-11.93%
DALDELTA AIR LINES INC.28.05-1.50-5.08%
CCLCARNIVAL CORP.12.84-1.57-10.90%
GMGENERAL MOTORS COMPANY21.30-0.07-0.35%

Abbott Laboratories surged after the company’s five minute COVID-19 test received Food & Drug Administration approval. Johnson & Johnson announced testing for its COVID-19 vaccine would begin by September and that it could be available for emergency use authorization in early 2021.

Regeneron and Sanofi said Monday that their rheumatoid arthritis drug Kevzara treated its first patient with severe COVID-19 in a global clinical trial.

TickerSecurityLastChangeChange %
ABTABBOTT LABORATORIES80.05+5.49+7.36%
JNJJOHNSON & JOHNSON130.68+7.52+6.11%
REGNREGENERON PHARMACEUTICALS INC.468.70+19.18+4.27%
SNYSANOFI S.A.44.41+1.97+4.64%

Elsewhere, Apple gained despite Reuters reporting iPhone demand was likely to be down 18 percent from a year ago.

Jefferies CFO Peg Broadbent died over the weekend due to complications related to COVID-19.

TickerSecurityLastChangeChange %
AAPLAPPLE INC.251.15+3.41+1.38%
JEFJEFFERIES FINANCIAL GROUP14.42+0.08+0.56%

On the commodities front, West Texas Intermediate crude was trading down 6.7 percent at $20.08 per barrel and was flirting with its first close below $20 since February 2002. Meanwhile, gold fell 0.3 percent to near $1,6 an ounce.

U.S. Treasurys gained, pushing the yield on the 10-year note down 12.8 basis points to 0.616 percent.

In Europe, Germany’s DAX gained 0.6 percent while Britain’s FTSE and France's CAC were lower by 0.7 percent and 0.3 percent, respectively.

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Asian markets fell, with Japan’s Nikkei falling 1.6 percent, Hong Kong’s Hang Seng sliding 1.3 percent and China’s Shanghai Composite shedding 0.9 percent.

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