Markets were not fazed by Friday’s solid jobs report, Aurora Cannabis continues to slide and more in today’s Closing Bell on Money and Markets.
The Top Story
There’s a real possibility the Chinese economy will suffer more than just in the short term.
The mounting number of cases and death toll related to the coronavirus outbreak aren’t making the future seem any brighter. Chinese officials reported 31,131 cases of the virus with 636 deaths so far.
China is already battling a shrinking economy — it slowed to 6.1% in 2019 from 6.8% in 2018. One analyst projects 0% growth in the Chinese economy, thanks in large part to the coronavirus.
“China is really slowing and that’s worrying people for sure,” Evercore ISI Chairman Ed Hyman told CNBC’s “Squawk on the Street.” “People are not going out. They are not shopping, and that’s what’s hurting particularly China.”
JPMorgan China equity strategist Haibin Zhu trimmed the country’s expected GDP growth to just 1% for the first quarter.
With various American businesses having an interests in China, a virtual halt to economic growth could spell trouble down the road.
Money and Markets: Closing Bell*
S&P 500: 3,327 (-18 points, -0.5%)
DOW: 29,102 (-277 points, -0.9%)
NASDAQ: 9,520 (-51 points, -0.5%)
GOLD: $1,570.10 (+$3.70, +0.2%)
BITCOIN: $9,731 (+$16.47, +0.1%)
U.S. 10-YEAR YIELD: 1.58%
*- as of 4:19 p.m.
A Big Win
In this morning’s Wall Street Wake-Up, we told you to be on the lookout for Canada Goose Holdings Inc. (NYSE: GOOS) as it posted strong profit and revenue, but suggested the coronavirus outbreak is a headwind for sales. Shares of the clothing company fell 4.1% Friday.
Aircraft subcontractor Spirit Aerosystems Holdings Inc. (NYSE: SPR) slashed its dividend as it struggles due to 737 Max production halt. Its shares were fell 1.1%.
We also mentioned Aurora Cannabis Corp. (NYSE: ACB), but we’ll talk more about what happened to that stock in the Cannabis Corner below.
M&A News
Jacksonville, Florida-based Fidelity National Financial Inc. (NYSE: FNF) is spending $2.7 billion to acquire FGL Holdings (NYSE: FG). Fidelity already owns a minority stake in FGL. Shares of Fidelity National were down more than 6% Friday afternoon while FGL shares were flat.
Customer service cloud software company Salesforce.com Inc. (NYSE: CRM) has acquired Evergage, a maker of customer experience software. Terms of the deal were not disclosed but analysts estimate the deal is valued at more than $100 million.
Harsco Corp. (NYSE: HSC) is acquiring the environmental and regulated waste management arm of Stericycle Inc. (Nasdaq: SRCL) for $462.5 million.
Golden Nuggets
Gold futures continued to move higher despite a strong jobs report Friday (see our take below).
The price of gold moved up 0.2% to $1,570 an ounce. Silver, on the other hand, was not as fortunate. Futures were down 0.5% to $17.72 an ounce.
Platinum futures did have a 0.3% gain Friday afternoon to $970.80 an ounce while palladium was off $27 to trade at $2,201 an ounce.
Cannabis Corner
Aurora Cannabis Inc. (NYSE: ACB) continued to experience fallout from the retirement of its CEO.
Shares of Aurora Cannabis tanked 15%.
Other cannabis stocks suffered Friday as Canopy Growth Corp. (NYSE: CGC) dropped 7.2%. Two companies — Greengro Tech. (Over-the-Counter: GRNH) and Mcig Inc. (Over-the-Counter: MCIG) were down double-digits in the afternoon.
Stock Market Update
The U.S. economy added 225,000 jobs in January, according to the U.S. Bureau of Labor Statistics.
That was well above forecasts of 158,000, indicating the potential for future economic growth in 2020.
The report also said wages jumped 3.1% from 2019 and was slightly higher than December’s 3% increase.
Education and health services had the biggest gains for the month — a 72,000 increase in jobs. Construction had a net gain of 44,000 jobs while leisure and hospitality gained 36,000 jobs.
On the other end, manufacturing saw a 12,000-job loss and retail dropped by 8,300.
Despite the solid job market report, investors were more concerned about China’s economy and the coronavirus.
The Dow Jones Industrial Average fell 0.9%. The S&P 500 and Nasdaq Composite lost 0.5%. The markets ended the week with losses after four days of gains.
U.S. Treasurys were down as well Friday. The 5-year Treasury was down 0.05% while the 10-year was off 0.06%. The 30-year Treasury was down 0.07%.
Today’s Big Winners:
NortonLifeLock Inc. (Nasdaq: NLOK) +12%
National Oilwell Varco Inc. (NYSE: NOV) +10.4%
Abbvie Inc. (NYSE: ABBV) +5.8%
Workday Inc. (Nasdaq: WDAY) +2.4%
T-Mobile US Inc. (Nasdaq: TMUS) +3.2%
Today’s Big Losers:
Take-Two Interactive Software Inc. (Nasdaq: TTWO) -11.8%
Verisign Inc. (Nasdaq: VRSN) -5.4%
Wynn Resorts Ltd. (Nasdaq: WYNN) -5.4%
eBay Inc. (Nasdaq: EBAY) -4.7%
Dow Inc. (NYSE: DOW) -2.3%
Check back for the most important news and numbers each day after the Closing Bell, only on Money and Markets.
Don’t forget about “Marijuana Markets: a POTcast,” featuring the biggest cannabis news and investment notes from Banyan Hill’s Anthony Planas, here on Money and Markets each Saturday morning.