Wall Street opens lower, rising crude oil prices support energy shares

Cornelia Mascio
Febbraio 21, 2020

United States stocks were little changed on Thursday as a rise in the number of coronavirus cases outside China raised more concerns about the global impact of the epidemic, while a multi-billion dollar buyout deal for E*Trade Financial Corp boosted shares of the online discount brokerage.

The mood elsewhere was more subdued, as the number of new coronavirus cases climbed in South Korea and Japan reported two new deaths.

"The story suggests that the virus has spread to medical workers and people who help clean hospitals, so the markets are shook up by that", said Keith Bliss, senior vice-president at Cuttone & Co in NY.

China reported a sharp drop in new cases, but the data was treated with skepticism as another change in the diagnostic method raised questions about the extent to which daily tallies accurately reflect the state of the outbreak. "Once (the virus) is contained, you are going to see a snap back in growth".

Recent policy easing by China, a largely better-than-expected fourth-quarter earnings season and hopes that the economic jolt from the coronavirus will be short-lived have pushed Wall Street's main indexes to new highs in recent weeks.

Among the 11-major S&P 500 sectors, the Energy Index is the only one in the negative territory boosted by rising crude oil prices.

In other corporate news, ViacomCBS Inc slumped 18% as its earnings fell short of revenue and profit expectations in its first quarterly earnings results since closing its merger.

Among stocks, L Brands Inc LB.N slid 9.5% following a report that it was nearing a deal to sell control of Victoria's Secret to private equity firm Sycamore Partners, valuing the lingerie brand at $1.1 billion.

Declining issues outnumbered advancers for a 1.23-to-1 ratio on the NYSE and for a 1.68-to-1 ratio on the Nasdaq.

US stock index futures fell on Thursday, a day after the S&P 500 and Nasdaq closed at record levels, as the number of coronavirus cases outside China increased.

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