Day Traders Diary

2/3/20

The major averages rebounded, recovering some of the losses from the previous session's steep sell-off, but investors remained wary about the bounce as coronavirus fears lingered. The Dow Jones Industrial Average closed up 143 points or 0.5%, at 28,399. The S&P 500 gained 0.7% to end the day at 3,248 while the Nasdaq Composite rose 1.3% to 9,273.

Nike led the Dow higher with a 3.1% rise after analysts at UBS and JPMorgan recommended buying the stock on coronavirus-related weakness. JPMorgan called this recent pullback a "multi-year buying opportunity." Tesla, meanwhile, jumped more than 19% to record levels after an Argus Research analyst hiked his price target on the stock to $808 per share.

The major averages reached their session highs after the Institute for Supply Management said its manufacturing gauge showed activity in the sector expanded. Economists polled by Dow Jones expected a contraction in manufacturing activity for January.  The 30-stock Dow was up more than 350 points at its high of the day.

However, stocks gave back some of Monday's gains after Carnival confirmed one of its guests tested positive for coronavirus six days after leaving one of its ships. Carnival shares erased earlier gains and closed more than 1% lower on the news.

Gilead Sciences jumped 5% on news they are testing a treatment for the coronavirus.

U.S. Treasuries started the day on a lower note but spent a bulk of intraday action rebounding from session lows. The 2-yr yield increased three basis points to 1.35%, and the 10-yr yield was unchanged at 1.52%. The U.S. Dollar Index rose 0.5% to 97.84.