Dow Jones Industrial Average Drops After Johnson & Johnson Covid Vaccine Halt

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Stock indexes were modestly lower Tuesday after a big Monday for technology shares. There was some bad news on the Covid-19 vaccine front and little progress toward a fiscal stimulus bill in Washington, but most of Tuesday’s action was on the individual stock level, as third-quarter earnings season kicks off.

On Tuesday around midday, the

Dow Jones Industrial Average

was down 104 points, or 0.4%, the

S&P 500

dipped 0.3%, and the

Nasdaq Composite

ticked up 0.1%.

It was a contrast to Monday, when stocks jumped on little news during a light Columbus Day holiday and the technology-heavy Nasdaq rallied 2.6% to its third-highest close in history.

Contributing to the lackluster trading on Tuesday was an announcement from

Johnson & Johnson

(ticker: JNJ) on Monday night that it paused its trial of a coronavirus vaccine after an unexplained illness in a trial participant.

It isn’t uncommon for drugmakers to pause trials in this way, and so far the pause isn’t the more serious clinical hold.

“Investors’ risk appetite is on hold today following delays and difficulties in the development of a vaccine from Johnson & Johnson, while infection numbers keep on increasing everywhere,” said Pierre Veyret, technical analyst at ActivTrades. He added investors are acting cautiously ahead of earnings results and after the rally on Monday.

Released on Tuesday morning, the Bureau of Labor Statistics’ consumer price index for September came in about as expected. The National Federation of Independent Business’ small business optimism index for September beat forecasts and rose to its highest level since January.

Global stocks similarly lost Monday’s momentum on Tuesday. Asian stocks saw muted moves, with the Nikkei 225 rising 0.2% and indexes in China, India, and South Korea hugging the flat line.

In Europe, the Stoxx 600 index slipped 0.5%, as the

Dow gains 251 points as tech giants rally and stimulus hopes persist

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  • US stocks rose on Monday as Democrats and Republicans inched closer to a stimulus compromise.
  • Mega-cap companies including Apple and Amazon led indexes higher as investors rushed to the growth favorites.
  • President Trump urged Republicans to speed up Amy Coney Barrett’s confirmation to the Supreme Court so that they can pass a new stimulus bill before Election Day.
  • Investors also prepared for earnings season. Citigroup and JPMorgan are set to kick off reporting on Tuesday.
  • Oil futures sank as operations temporarily halted by Hurricane Delta resumed. West Texas Intermediate crude fell as much as 3.8%, to $39.04 per barrel.
  • Watch major indexes update live here.

US equities extended their rally into a new week as investors pushed tech giants higher.

Apple surged ahead of a Tuesday event widely expected to unveil the next generation of iPhones. Amazon climbed as it kicked off its Prime Day sale event. Other mega-caps including Alphabet and Microsoft also drove indexes’ gains.

Investors hoping for fresh government aid remained hopeful on the prospects of a near-term bill. The Trump administration raised its proposal to $1.8 trillion from $1.6 trillion on Friday, closing the gap with House Democrats’ $2.2 trillion bill.

The measure includes another round of stimulus checks and funding for the Paycheck Protection Program, but falls short of Democrats’ allocations for expanded unemployment benefits and state and local governments. 

Here’s where US indexes stood at the 4 p.m. ET market close on Monday:

Read more: GOLDMAN SACHS: Buy these 15 stocks set to deliver the strongest possible profit growth and subsequent returns through year-end

Still, House Speaker Nancy Pelosi described the administration’s new offer as “one step forward, two steps back.” Pelosi and Treasury Secretary Steven Mnuchin are expected to continue negotiations throughout the week, though the odds of

Dow Jones Surges 300 Points as Apple iPhone Event Approaches, Cisco Stock Shakes Off Downgrade

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A winter wave of COVID-19 may be brewing in the U.S., with many states reporting distinct increases in confirmed cases. More economic stimulus may be necessary if the pandemic worsens from here, but Congress remains deadlocked on the issue. Despite all of this, the stock market was surging on Monday, with the Dow Jones Industrial Average (DJINDICES:^DJI) up 1.05% at 1:05 p.m. EDT.

Tech giant Apple (NASDAQ:AAPL) was the Dow’s top performer on Monday, rallying hard one day before the company is expected to announce iPhones that feature 5G technology. Shares of Cisco Systems (NASDAQ:CSCO) were also higher despite an analyst downgrade.

5G text over earth.

Image source: Getty Images.

Apple surges ahead of iPhone event

If 2020 were a normal year, Apple’s latest iPhones would have likely already launched. But supply chain disruptions due to the COVID-19 pandemic forced Apple to delay the launch by a few weeks. At an event in September, Apple unveiled new Apple Watches, iPads, and subscription services, but the iPhone was absent.

The story changes tomorrow when Apple is expected to announce its iPhone 12 lineup at an event scheduled for 10 a.m. PDT. While nothing has been confirmed about the devices so far, the new iPhones are expected to sport a new form factor, multiple display size options, and 5G connectivity.

The support for 5G may be enough to spur elevated upgrade activity from those with older iPhones, but the jury is still out on how much consumers really care about the latest wireless technology. Apple has seen strong sales of iPhones during the pandemic, partly due to the launch of the affordable iPhone SE, and partly due to economic stimulus. Whether full-priced iPhones sell as well absent additional stimulus is an open question.

Apple stock was soaring on Monday as investors looked ahead to the iPhone

Stock market news today: Dow, S&P fall on Trump’s COVID-19 test, tech slump

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  • US stocks sank on Friday after President Donald Trump and First Lady Melania Trump said they both tested positive for COVID-19.
  • The diagnosis adds more uncertainties to the final month of a presidential race already expected to fuel outsize market volatility.
  • While some sectors pared losses and swung higher, falling tech stocks dragged on major indexes and led the Nasdaq composite to underperform its peers.
  • Investors also faced off against weakening economic data. US businesses added 661,000 nonfarm payrolls in September, according to the Bureau of Labor Statistics. That’s less than economists’ expectation of 859,000 payrolls.
  • Oil futures continued to slide below the $40 support level. West Texas Intermediate crude dropped as much as 5.4%, to $36.63 per barrel.
  • Watch major indexes update live here.

US equities tumbled on Friday after President Donald Trump and First Lady Melania Trump announced they both tested positive for COVID-19.

Trump was tested late Thursday night after close aide Hope Hicks tested positive for the virus earlier in the week. The White House physician did not say whether the president was showing symptoms, or how long he had been infected. The diagnosis is poised to halt Trump’s campaign events mere weeks away from the US presidential election.

All three major stock indexes sank in the morning in choppy trading. While some sectors pared most losses through the day, falling tech giants slammed benchmarks and led the Nasdaq composite to underperform its peers. Utility, energy, real estate, and industrial stocks all posted gains.

Here’s where US indexes stood at the 4 p.m. ET market close on Friday:

Read more: BANK OF AMERICA: Buy these 29 high-quality value stocks primed to cash in on the economic recovery

The Cboe Volatility index — or VIX, which is commonly referred to as the stock market’s fear gauge —

Dow Inc. to Pare Workforce Costs 6%, Take Charges

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Storied materials-science company Dow Inc.  (DOW) – Get Report said that it would restructure, cutting “workforce costs” 6% and taking $500 million to $600 million of third-quarter charges for the effort.

It didn’t specify the amount of any layoffs.

The restructuring stems from the coronavirus pandemic, which has curbed demand for Dow products, the company said.

Besides the 6% cost cut, the revamp includes “[rationalizing] certain manufacturing assets,” the Midland, Mich., company said in a statement. 

“These actions are expected to result in total annualized [earnings before interest, taxes, depreciation and amortization] savings of more than $300 million by the end of 2021.”

The industrial intermediates-and-infrastructure segment will shut certain amines and solvents facilities in the U.S. and Europe, as well as select small-scale downstream polyurethanes manufacturing facilities. 

The performance-materials-and-coatings unit will shutter manufacturing assets, primarily small-scale coatings reactors.

“Given the expected gradual and uneven global economic recovery from covid-19, we announced in July that we are taking necessary actions to continue to optimize our asset footprint, reduce structural costs and enhance the competitiveness of our business over the long-term,” Dow Chief Executive Jim Fitterling said in the statement.

“We continue to stay focused on delivering strong cash flow, strengthening our financial profile and maximizing our operational advantages.”

The charges reflect severance and benefit costs; costs tied to exit and disposal activities; and asset write-downs and write-offs, Dow said.

Dow said it remained on track to achieve its target of $1.25 billion of capital expenditures in 2020, down from $2 billion in 2019.

The company also said on Wednesday that it would close the sale of its rail-infrastructure assets at six North American sites to Watco, three months earlier than planned. The sale proceeds exceed $310 million. Watco is the Pittsburg, Kan., transportation-services provider.

Earlier this month Dow