A men wearing a mask walk at the Shanghai Stock Exchange building at the Pudong financial district in Shanghai, China, as the country is hit by an outbreak of a new coronavirus, February 3, 2020.
Aly Song | Reuters
This is a live blog. Check back for updates.
11:03 am: Treasury yields rise for the first time in four sessions
The yield on the benchmark 10-year Treasury note, which moves inversely to price, climbed 4 basis points to around 1.554%. Monday’s action marks the first advance in four trading days for the 10-year yield, which has fallen about 30 basis points in the past two weeks on coronavirus fears. Rates hit their session highs after the ISM manufacturing Purchasing Managers’ Index for January topped economists’ estimate and signaled an expansion. The benchmark 10-year yield dipped below the three-month Treasury rate last week, sending a recession signal. — Li
11:00 am: Oil falls despite reports that OPEC is considering large production cut
As oil prices collapse, OPEC is considering additional production cuts that could exceed 1 million barrels per day. “I think it is a ‘go big or go home’ moment for the organization,” RBC Capital Markets’ Helima Croft said to CNBC. On Monday, U.S. West Texas Intermediate crude and international benchmark Brent crude both dropped to their lowest levels since Jan. 2019, before paring some of those losses, as the coronavirus outbreak continues to hit prices. Both WTI and Brent are trading in bear market territory and coming off a fourth straight week of losses. Earlier in the session WTI briefly turned positive after The Wall Street Journal reported, citing OPEC officials, that Saudi Arabia was considering a 1 million barrels per day cut in order to stimulate prices. The energy alliance’s Joint Technical Committee, a non-ministerial sub group that reviews the oil market, will reportedly hold meetings Tuesday and Wednesday in Vienna. — Stevens
10:20 am: Market’s next move could be decided by today’s trading
Instinet’s Frank Cappelleri says today’s market action could help decide how bearish the market’s tone has become. “For months, you didn’t have any type of bearish pattern pop up much less follow through,” said Cappelleri, Instinet executive director. That changed in the past two weeks with the more than 3.7% peak to trough decline in the S&P 500. If the market does not continue moving higher and head to its highs, there could be a steeper pullback, due to a bearish setup. The downside target would be 3,130. “A lot has to do with how this initial lift works out today,” he said, noting the opening surge higher could weaken or reverse. The S&P 500 was trading just under 3,250 in morning trading. “We still have to be concerned if the next lift is a lower high,” which would be negative, he said. “We’re so used to having any pullback being 2 to 4%.” — Domm
10:17 am: El-Erian says coronavirus to ‘paralyze China,’ don’t buy stock dips
Economist Mohamed El-Erian told CNBC’s “Squawk Box” on Monday that investors should “try and resist our inclination to buy the dip” in the stock market. The Allianz chief economic advisor and ex-Pimco CEO sees the coronavirus outbreak as a game-changer. “For a long time I though the market sentiment was so strong that we could overcome a mounting list of economic uncertainty,” he said. “But the coronavirus is different. It is big. It’s going to paralyze China. It’s going to cascade throughout the global economy.” —Belvedere
10:15 am: Stocks pare gains slightly on China trade news
The Dow cut some of the morning gains, last up 323 points, after a headline from Bloomberg News said the Chinese are seeking flexibility from the U.S. side on some promises in the phase one trade deal. Bloomberg News, citing sources familiar with the matter, said the deal reached early January has a clause that the countries will consult “in the event that a natural disaster or other unforeseeable event.” The Dow was up 362.01 points before the trade news was released. CNBC has reached out to the White House for comments. —Li
10:12 am: ISM manufacturing activity rebounds in January
Stocks got an added boost from an encouraging read on the manufacturing economy on Monday. The Institute for Supply Management (ISM) said its index of national factory activity increased to a reading of 50.9 in January, the highest level since July. Economists polled by Dow Jones were expecting a reading of 48.5, as the last five readings contracted. Any reading below 50 signals a contraction. All three major averages are up over 1%, gaining back about half of Friday’s losses. —Fitzgerald
10:08 am: Argus raises Tesla price target to Street high of $808
Argus Research now has the highest Tesla price target among analysts on Wall Street, increasing its outlook to $808 a share from $556 a share on Monday. Argus said it sees continued growth in sales of Tesla’s Model S and Model X models, “as well as strong demand for the new Model 3.” Tesla shares rose nearly 11% in early trading from its previous close of $650.57. — Sheetz
9:49 am: Apple turns positive, stocks at session highs
The market has risen to new session highs and by no coincidence, Apple is now in the green slightly. Apple was the one big notable laggard in early trading, but its reversal has given bulls confidence to take the market even higher. Dow up 260. — Melloy
9:40 am: Tepper says outbreak ‘may be a game changer’
Appaloosa Management’s David Tepper was bullish on the market just a few weeks ago, but is now urging caution as the new coronavirus outbreak continues to spread. Tepper told Jim Cramer in an interview for TheStreet that the outbreak has “certainly ruined the environment” that made him bullish on stocks.”You have to be careful, because it may be a game changer. So you’ve just got to be cautious,” Tepper said. —Pound
9:35 am: Latest on Coronavirus
China’s National Health Commission on Monday confirmed 17,205 cases of the coronavirus in the country and 361 deaths. The number has surpassed that of the SARS virus which lasted from 2002 to 2003. Meanwhile, a first death outside of China was reported in the Philippines over the weekend. Follow CNBC’s coronavirus live blog for updates. —Li
9:30 am: Dow up 100, but Apple is a drag
The Dow is taking a little bit of Friday’s 600-point drop back on Monday. Lots of green on the board with advancers outnumbering decliners on the NYSE by 3.5-to-1. Nike among the biggest gainers on Wall Street recommendations of buying the dip (see below). But look no further than Apple to see how coronavirus is still looming large over the market. Apple is off on fears its sales will take a hit from the virus and concern production could be disrupted as well. – Melloy
9:11 am: Goldman Sachs double downgrades Northrop Grumman
Shares of Northrop Grumman slid 1.8% in premarket trading after Goldman Sachs lowered its rating on the defense and aerospace giant to sell from buy. Goldman said “differentiated growth keeps not coming through” for Northrop Grumman and “margins are compressing.” In terms of its price-to-earnings ratio, Northop Grumman is “the most expensive large-cap defense stock,” Goldman added. —Sheetz
9:01 am: Apple analyst slashes iPhone shipment forecast by 10% amid coronavirus epidemic
TF International Securities cut its iPhone shipment forecast by 10% for the current quarter due to worries about the Chinese coronavirus. ″Our latest survey indicates that the iPhone supply is being affected by the coronavirus and, therefore, we cut the iPhone shipment forecasts by 10% to 36-40 mn units in 1Q20,” Apple analyst Ming-Chi Kuo said in the note. Kuo said it is unclear if the second quarter of 2020 will be effected. Shares of Apple dipped 0.7% in premarket trading on Monday. —Fitzgerald
8:51 am: Gilead climbs on news of experimental coronavirus drug
Shares of Gilead Sciences rose 4.5% in premarket trading on news that the company is offering an experimental drug to treat the new coronavirus. The drug, called remdesivir, is not licensed or approved in any country, the company said in a statement, but it is being used as emergency treatment in some cases. “Gilead is working with health authorities in China to establish a randomized, controlled trial to determine whether remdesivir can safely and effectively be used to treat 2019-nCoV,” the company said. —Pound
8:47 am: Biggest analyst calls of the day
- Credit Suisse downgraded Verizon to neutral from outperform.
- Wedbush added Uber to the best ideas list.
- Stifel upgraded Seagate Technology to buy from hold.
- Credit Suisse downgraded ViacomCBS to neutral from outperform.
- Credit Suisse upgraded Charter Communications to outperform from neutral.
- UBS upgraded Nike to buy from neutral.
- JPMorgan added Nike to the focus list.
- Goldman Sachs downgraded Exxon Mobil to sell from neutral.
- Telsey upgraded Abercrombie & Fitch to outperform from market perform.
- Goldman Sachs upgraded Ulta to buy from neutral.
- Goldman Sachs downgraded Northrop Grumman to sell from buy.
- BMO downgraded Electronic Arts to market perform from outperform.
- Morgan Stanley upgraded Monster Beverage to overweight from equal weight.
- RBC upgraded Colgate-Palmolive to outperform from sector perform
CNBC Pro subscribers can read more here. —Bloom
8:44 am: Alphabet climbs ahead of earnings
Shares of Alphabet rose in premarket trading as investors prepared for the tech giant’s earnings announcement after the bell. KeyBanc Capital Markets analyst Andy Hargreaves said in a note to clients previewing earnings season that he expected the tech giant to post net advertising revenue growth of 17.7% and a gross margin of 53.6%.Other large tech companies have seen wide swings following quarterly reports this earnings season. Amazon rose 7.4% in the session following its report, while Facebook slid 6.1%. The stock price for Google’s parent company was up about 1.1% before the bell. —Pound
8:40 am: China stocks plummet on coronavirus fears, Shanghai index drops 7.7%
Chinese stocks tanked overnight in their first trading session since closing for the Lunar New Year holiday as the deadly coronavirus continues to spread. The Shanghai Composite dropped 7.7%, its biggest decline since Aug. 24, 2015. Meanwhile, the Shenzhen A Shares index closed more than 8% lower in its worst session since 2007. The death toll in China from the coronavirus reached 361 on Sunday, surpassing that of the SARS virus which lasted from 2002 to 2003. China’s central bank announced it will inject 1.2 trillion yuan worth of liquidity into the economy in an effort to stymie a sharp economic slowdown. However, there are already signs the economy is hurting from the coronavirus. The Markit/Caixin manufacturing PMI came in at 51.1 for January, just below economy expectations. —Imbert
8:39 am: Wall Street says buy the dip in Nike’s stock despite coronavirus fears
Shares of Nike jumped nearly 2% in premarket trading on Monday after UBS upgraded the stock to buy from neutral and JPMorgan added Nike to its “analyst focus list.” The firms said they recommend buying the recent dip in Nike shares, which are trading below their historical P/E averages. Shares of Nike are down about 8% in the past two weeks on worries about the Chinese coronavirus’s impact on Nike’s China revenue. JPMorgan said the recent pullback is a “multi-year buying opportunity” and UBS said “the market will pay a much higher P/E for NKE as it realizes how Nike’s business model changes will make the company worth much more long-term.” —Fitzgerald