A worker wearing protective gears sprays disinfectant as a precaution against the coronavirus at a subway station in Seoul, South Korea. Photo Credit: Ahn Young-joon/AP/Shutterstock
DAMIAN J. TROISE AP Business Writer
U.S. stocks fell in early trading Friday as cases of the new virus swelled in South Korea and more companies warned investors about a hit to their profits and revenue.
Renewed anxiety over the global spread of the virus also pushed stocks lower on Thursday and knocked them off of record highs in what has been a volatile, holiday-shortened week. Indexes are on track for their first weekly loss after two weeks of gains.
Technology companies led the losses. Chipmakers, which rely heavily on China for both sales and supply chains, were some of the worst-hit. Nvidia fell 1.7 percent.
Companies that depend on consumer spending, especially in travel-related industries, also fell broadly. Marriott shed 2.4 percent and Carnival fell 1.6 percent. American Airlines slipped 3.3 percent.
Investors headed for safer territory. Real estate companies and utilities held up better than the rest of the market. Bond prices rose and pushed yields lower. The yield on the 10-year Treasury fell to 1.47 percent from 1.52 percent late Thursday.
The price of gold, another haven for nervous investors, jumped 1.4 percent.
KEEPING SCORE: The S&P 500 index fell 0.9 percent as of 10:10 a.m. Eastern time. The Dow Jones Industrial Average fell 268 points, or 0.9 percent, to 28,949. The Nasdaq fell 1.2 percent. The Russell 2000 index of smaller-company stocks fell 0.8 percent.
Asian and European markets also fell.
VIRUS WARNINGS: Coca-Cola is the latest big name to warn investors that the economic impact of the virus will hurt its finances. China is a big market for the company, and Coke now expects a hit of 2 cents per share to its first-quarter profit.
Universal Display, which makes LED-technology for televisions and other products, expects the virus to hurt orders in 2020. The International Air Transport Association said the virus threatens to erase $29 billion of this year’s revenue for global airlines, though mostly for Chinese carriers.
SPREADING ANXIETY: South Korea said 204 people have been infected with the virus, quadruple the number of cases it had two days earlier. More than 76,000 people have been infected globally, with most of the cases and deaths centered in China. That nation’s leadership on Friday shifted to a more cautious tone and said it has not yet reached a turning point for the virus and the situation in the hardest-hit province remains grave.
GOOD HARVEST: Deere jumped 9.1 percent after the farm equipment maker handily beat Wall Street’s fiscal first-quarter profit forecasts. The company is coming out of an extended period in which it was bruised by the ongoing trade war between the U.S. and China.
Wealthfront’s CFO Alan Iberman talks the $2.05B IPO and the major moment for robo banking as the company bets on AI, automation, and “self-driving money."
A rare magnum of Dom Pérignon Vintage 1961 champagne that was specially produced for the 1981 wedding of Prince Charles and Lady Diana has failed to sell during an auction. Danish auction house Bruun Rasmussen handled the bidding Thursday. The auction's house website lists the bottle as not sold. It was expected to fetch up to around $93,000. It is one of 12 bottles made to celebrate the royal wedding. Little was revealed about the seller. The auction house says the bids did not receive the desired minimum price.
The New York Times and President Donald Trump are fighting again. The news outlet said Wednesday it won't be deterred by Trump's “false and inflammatory language” from writing about the 79-year-old president's health. The Times has done a handful of stories on that topic recently, including an opinion column that said Trump is “starting to give President Joe Biden vibes.” In a Truth Social post, Trump said it might be treasonous for outlets like the Times to do “FAKE” reports about his health and "we should do something about it.” The Republican president already has a pending lawsuit against the newspaper for its past reports on his finances.
OpenAI has appointed Slack CEO Denise Dresser as its first chief of revenue. Dresser will oversee global revenue strategy and help businesses integrate AI into daily operations. OpenAI CEO Sam Altman recently emphasized improving ChatGPT, which now has over 800 million weekly users. Despite its success, OpenAI faces competition from companies like Google and concerns about profitability. The company earns money from premium ChatGPT subscriptions but hasn't ventured into advertising. Altman had recently announced delays in developing new products like AI agents and a personal assistant.
President Donald Trump says he will allow Nvidia to sell its H200 computer chip used in the development of artificial intelligence to “approved customers” in China. Trump said Monday on his social media site that he had informed China’s leader Xi Jinping and “President Xi responded positively!” There had been concerns about allowing advanced computer chips into China as it could help them to compete against the U.S. in building out AI capabilities. But there has also been a desire to develop the AI ecosystem with American companies such as chipmaker Nvidia.
