Bulls saw big gains on Friday, and those gains continued on Monday, with equities gapping higher. However, small-cap stocks showed up in a big way in the stock market today, with the Russell 2000 rallying almost 5% at its highs.
The iShares Russell 2000 ETF (NYSEARCA:IWM) was one of our Top Stock Trades as a result of the move. Some have been critical of how small-cap stocks have lagged their larger-cap peers. However, Monday’s action went to great lengths to show that the Russell could run too.
With an enormous week of earnings and several notable economic reports due up, we are getting to an interesting juncture. Will bulls continue to squeeze stocks higher or will bears get the best of investors and take equities back down?
Dividend Troubles and Meat Problems
In an attempt to save cash during this trying time for automakers, General Motors (NYSE:GM) is suspending its quarterly dividend and stock buybacks. The company also took additional measures with its credit lenders to improve its liquidity. Ford (NYSE:F) and GM are looking at when to restart facilities that have been halted due to the pandemic.
Tyson Foods (NYSE:TSN) is warning that the pandemic is causing millions of pounds of meat to leave the supply chain. The novel coronavirus has caused many meat plants to shut down over the last few weeks, which in turn will cause a shortage of pork, beef and chicken until Tyson can reopen facilities. So far, at least eight major U.S. meat plants have had to stop production.
Movers in the Stock Market Today
Before the coronavirus outbreak hit, Apple (NASDAQ:AAPL) shares were skyrocketing with the anticipation of new 5G iPhones. Now the production is being pushed back due to the negative impacts to its supply chain. The new lineup reportedly has four models in three sizes — 5.4-inches, two 6.1-inch models and a 6.7-inch — all with OLED screens. Apple expects to reduce handset production by as much as 20% in the second half of 2020. Further, analysts are anticipating lower-than-expected numbers for 2020 iPhone sales.
Coca-Cola (NYSE:KO) just signed a five-year deal with Microsoft (NASDAQ:MSFT), although the financial terms are still unknown at this point. Microsoft will be providing Coca-Cola with business software that will first be used by employees, then customer service agents. Teams, Microsoft 365 and Dynamics 365 are among the programs that will be utilized.
Gilead Sciences (NASDAQ:GILD) shares were about flat in the stock market today. That’s despite reports that Japan plans to fast track an approval for its Covid-19 treatment, remdesivir, next month. A clinical trial should wrap up in the country as early as this week.
Unfortunately, Regeneron (NASDAQ:REGN) news isn’t as promising. Data from Phase 2 and Phase 3 clinical trials show that Sanofi (NASDAQ:SNY) and Regeneron’s Kevzara shows no notable benefits.
Zoom Video (NASDAQ:ZM) can ease worries of Facebook’s (NASDAQ:FB) new video feature, Messenger Rooms. Morgan Stanley gave Zoom a price target of $105 and an equal-weight rating. The firm argues that the enterprise market is still the company’s largest opportunity. It will “remain the most attractive market for Zoom, making improvements by others on consumer/social fronts not impactful,” the analyst said.
Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell is long AAPL.
