The day started with the SPX and stocks moving higher until a slow and steady drip of of negative coronavirus news poured in.
Opening $21 higher, the SPX saw components like AAPL, FB, etc. opening several dollars higher. Then news came out that Spain had a case of the virus, which took the SPX into the red.
NEWS WATER TORTURE
Next a case in Austria showed up. Later Iran said it had 15 deaths and 100 case. Switzerland then announced it had a case. Italy locked down an entire hotel. Later, HHS Secretary Azar announced there was a shortage of 3M masks. Later, Italy announced its cases spiked to 322 with 10 deaths. Germany was next with a patient testing positive.
At this point, the SPX had slipped to -$50 on the day, but was trading in an orderly fashion until the CDC announced “Americans should prepare for community spread”. The World Health Organization came out and stated it is not ready for the virus to spread. I found this kind of obvious. Of course no one is ready for the virus to spread. Have you ever been to an ER room and waiting for hours without a coronavirus outbreak? Later, the CDC came out on CNBC and said a pandemic is not a question of “if” but “when”.
With the markets seeing an average of over 2 negative headlines every hour from respectable sources, even the most optimistic individual had to question the sanity of being long shares.
SPX – The high of the day saw the SPX up $21.10 and the low saw the SPX get to 3113.77 (down -107.12). At the highs of the year, the SPX was up about 5% and now we are down almost 4%.
AAPL – Closed down -10.10 (3.39%) at 288.08. The stock was at $327.85 a couple weeks ago ($39.77 higher), meaning it is 12% off the highs. This is not surprising as I have been talking in POT class how the graph is parabolic and not healthy.
MRNA – Moderna, Inc is a pharmaceutical company that we just started to watch since the “plague” started. They announced today that they sent a vaccine to the CDC for approval to treat the coronavirus. The stock closed up 27.8% at 23.76 (+$5.17).
FDX – The stock closed down $9.25 at $145.60 (-6%) on fears of a global slowdown. Just last week, we did very well in a legged butterfly example with a center strike at $165. The stock was running higher because of the surgical masks being shipped to China. Now the same virus is hurting the stock. It is all perspective.