Stocks are set to start the week down as investors brace for the beginning of the corporate earnings season, plus stocks to watch today in the Money & Markets Opening Bell.
The Top Story
It could be a very difficult week for corporate America as companies begin to report earnings for a quarter that saw businesses ravaged by the spread of the novel coronavirus.
JPMorgan Chase & Co. (NYSE: JPM) and Wells Fargo & Co. (NYSE: WFC) will kick off the corporate earnings season on Tuesday, with analysts expecting first-quarter earnings at S&P 500 firms to fall 9% compared with a Jan. 1 forecast of a 6.3% rise, according to IBES data from Refinitiv.
The S&P 500 had fallen nearly 35% from its mid-February record highs — into a bear market — but unprecedented U.S. fiscal and monetary stimulus and early signs the outbreak could be peaking have helped it recover about 27%.
The benchmark index ended a holiday-shortened week on Thursday with its biggest weekly percentage gain in more than four decades as the Federal Reserve rolled out trillions of dollars to backstop businesses.
Over the weekend, major oil producers agreed to their biggest-ever output cut (see below for more), but crude prices were subdued on concerns even that would not be enough to head off oversupply with the health crisis hammering demand.
Where things stand: As of 9:20 a.m., Dow Jones futures were down 0.3%. S&P 500 futures were down 0.3% and Nasdaq Composite futures were off by 0.2%.
Stocks to Watch Today
Caterpillar Inc. (NYSE: CAT) — The American machinery manufacturer was downgraded to “underperform” by Bank of America Corp. (NYSE: BAC) analysts, citing weakness in the company’s energy business. Shares of Caterpillar were down 2%.
Gilead Sciences Inc. (Nasdaq: GILD) — Shares of the biotechnology company were up nearly 3% early on the news that its remdesivir drug showed “clinical improvement” during trials to fight off the coronavirus.
Alnylam Pharmaceuticals Inc. (Nasdaq: ALNY) — The Massachusetts-based biopharmaceutical company is getting a $2 billion investment from Blackstone Group Inc. (NYSE: BX) to further develop RNA interference medicines. Shares of Alnylam were up 5.2% in premarket trading.
Nations Finalize Oil Production Agreement
OPEC nations finally agreed on a plan to remove 9.7 million barrels of oil off the market per day after a weekend full of back-and-forth discussion.
In an emergency meeting Sunday, the OPEC+ group met to reach an agreement to prop up sluggish oil prices as the coronavirus outbreak stifles demand. The new agreement also ends a price war between Saudi Arabia and Russia that began in early March.
The new deal also includes Mexico’s demand to only cut 100,000 barrels per day instead of the 400,000 it was asked to cut.
The production cut will start on May 1, and extend to the end of June.
Treasury Begins Sending Stimulus Payments This Week
The Internal Revenue Service has started sending out $1,200 coronavirus stimulus payments to middle and lower-income adults, plus $500 for their minor children.
However, it could take until September for every eligible American to get the money, according to Bloomberg.
The IRS will first send the money to individuals for whom the agency has direct deposit information — nearly 60 million people. The rest will be mailed as checks. The mailing process is expected to start on April 20.
Samuel Adams Offering Grants to Unemployed Restaurant and Bar Staffers
The maker of Samuel Adams beer has launched a fund to provide $1,000 to restaurant and bar workers in 20 states, including California, Georgia, Illinois, New York, Texas and Vermont.
The Massachusetts brewer started the fund in mid-March and expanded it following a partnership with The Greg Hill Foundation.
We’re excited to announce that we’re expanding our Restaurant Strong Fund to 19 more states around the country. THANK YOU to everyone who has already helped or donated. Together, we can support those in the restaurant industry who have been so impacted by closures. pic.twitter.com/FVj4kgN27A
— Samuel Adams Beer (@SamuelAdamsBeer) April 3, 2020
What We’re Reading
Best Dividend Stocks to Buy in a Market Crash (Money & Markets)
3M Accuses Mask Vendor of Price Gouging (USA Today)
Bonner: The Feds’ Disaster Deepens (Money & Markets)
Earnings Report
Here are the companies releasing earnings reports today:
There are no earnings reports scheduled for Monday.
Check back each morning before the opening bell for stocks to watch today with Opening Bell, here on Money & Markets.