Day Traders Diary

2/5/20

The major averages are surging once again, building on the week's already strong gains, as investors recover from a recent drop sparked by coronavirus fears. The Dow Jones Industrial Average is up over 300 points or 1.1%. The S&P 500 is up nearly 1% while the Nasdaq Composite is trading up 0.7%.Better-than-expected jobs data is also lifted investor sentiment.

UnitedHealth and Caterpillar rose 2.5% and 1.9%, respectively, to lead the Dow higher. Energy, tech and financials were up more than 1% each to lift the S&P 500.

Earlier on Wednesday, Reuters said a Chinese TV media outlet had reported that a research team at Zhejiang University had found an effective drug to treat people with the new coronavirus. The news agency, citing traders, suggested this was a reason for the move higher in stocks.

Confirmed coronavirus cases in China are near 25,000, claiming the lives of 490 people. President Donald Trump said during Tuesday's State of the Union address that the U.S. is "working closely" with the Chinese government to contain the virus.

Walt Disney initially traded up 5% but is now down a percent on earnings. Merck is down 3% despite beating top and bottom-line estimates and guiding 2020 above consensus. Ford Motor is down 9% after lowering guidance. GM is modestly higher on earnings. Snap is down 9% after revenue results were just shy of expectations. Match Group is down 6% after missing revenue estimates and guiding first quarter revenue below consensus.

Treasuries have edged even lower after yesterday's sell-off. The 2-yr yield is up three basis points to 1.44%, and the 10-yr yield is up four basis points to 1.64%. The U.S. Dollar Index is up 0.1% to 98.07. WTI crude has rebounded 2.3%, or $1.15, and is trading back above $50 per barrel at $50.76.