Stocks – Dow Rebounds as Apple Rallies Into Earnings
The Dow rallied sharply Tuesday, as the rout a day earlier attracted bargain buying across stocks, even as the bulk of corporate earnings failed to live up to Wall Street expectations.
The S&P 500 rose 1%, while the Nasdaq Composite gained 1.4% and the Dow Jones Industrial Average rose 0.7%.
Bargain-hunting investors piled into beaten-down sectors like tech and travel stocks.
American Airlines and Delta Air Lines both ended in a day the green. But United Airlines proved an expectation to the rally after announcing that it was cutting some flights from the U.S. to mainland China, citing a “significant decline in demand as the coronavirus continues to spread.”
The death toll from the coronavirus in China rose to 106, with 4,600 affected globally, according to media reports.
Tech also saw some reprieve, led by a rebound in semiconductor stocks with some on Wall Street suggesting the outbreak may pose a benefit to U.S.-based chip firms.
Any disruption to memory output in China on the back of a faster spread of the virus could “be positive for memory suppliers outside of China such as Micron, Western Digital and others.
The Philadelphia Semiconductor Index ended the day more than 2% higher.
Apple also supported the rally in the broader market, rising nearly 3% ahead of its fiscal first-quarter report due after the closing bell.
A wave of mostly bearish earnings, meanwhile, had little impact on sentiment.
Meanwhile,Pfizer fell 5% after its missed quarterly earnings estimates, driven partly by the loss of exclusivity for its pain drug Lyrica.
Sentiment on stocks was also underpinned by bullish economic data showing a sharp rise in consumer confidence.