We saw a rocket bounce in the stock market today, as investors continue to anticipate a stimulus bill from Congress. Investors hope the bill will be enough to provide some economic relief for the public, as well as hospitals and businesses.
The S&P 500 climbed 9.4% on the day, while the Nasdaq Composite rose 8.1%.
Because the bottom in the fourth quarter of 2018 was a “V-shaped” recovery — meaning a sharp decline matched by a very sharp rally with no retest of the low — doesn’t mean this low will be like that.
This is a very different market than the one in 2018 and stocks declined for very different reasons.
That doesn’t mean we can’t see a V-shaped bounce. But generally speaking, a bottom in the stock market is more of a process rather than an event. We’ll know more after hearing from Congress on what the bill looks like, as many anticipate its completion sometime on Tuesday.
Movers in the Stock Market Today
Microsoft (NASDAQ:MSFT) CEO Satya Nadella says he’s confident the company will be okay despite the coronavirus from China. Microsoft has a strong balance sheet, while work-from-home trends have given a boost to PC sales. Further, Microsoft’s Teams collaboration software just passed 44 million daily active users.
Delta Air Lines’ (NYSE:DAL) credit rating was lowered from a BBB- to BB by S&P Ratings Agency. The move lands Delta in the junk territory. The firm believes that Delta won’t be able to make up the massive amount of lost revenue, while Finch also downgraded the company to “negative” last week. Moody’s has issued a warning too.
Kevin Johnson, CEO of Starbucks (NASDAQ:SBUX), believes the U.S. is following a similar track to China in regards to the coronavirus. Johnson stated, “the recovery is unfolding in China and that is what gives us confidence that we know how to manage through this.” Starbucks has reopened about 95% of the stores it originally closed in China, including several in Wuhan.
Ford (NYSE:F) originally planned to restart U.S., Canada and Mexico production on March 30. However, it will push that restart date back due to the continued Covid-19 outbreak.
In more auto news, the growing uncertainty of the coronavirus pandemic has resulted in General Motors (NYSE:GM) withdrawing its full-year guidance. The company plans to draw $16 billion from its credit lines as well. That will bolster the $15 billion to $16 billion it already has in cash, as GM loads up just in case.
CEOs Stepping Up
Many big tech CEOs are stepping in to help the fight against the coronavirus outbreak. Tim Cook, CEO of Apple (NASDAQ:AAPL), says the company will donate millions of masks to the U.S. and Europe.
Tesla (NASDAQ:TSLA) CEO Elon Musk said the company is making and distributing ventilators for distribution this week. Also Mark Zuckerberg stated that Facebook (NASDAQ:FB) will be providing 720,000 masks to healthcare workers. Salesforce (NYSE:CRM) CEO Marc Benioff joined in, announcing the company has already delivered 9,000 masks to San Francisco’s University of California.
That’s alongside the effort from Ford and GM to manufacture ventilators as well.