Stocks took a hit as the spread of the coronavirus inspired a “risk off” flight to safety. Earnings reports this week include Tesla, Apple, Amazon, Boeing and GE. At the close the Dow was down 453 at 28,535 on heavy trading volume. The good folks over at BTS traded out of high yield and into treasuries based on slowing momentum and positive bias to Treasuries. IBD is still positive on equities but at this stage caution is advised.
The Wuhan coronavirus continued to spread over the weekend as reported cases in China jumped 50%. It started in a seafood market and the mayor of Wuhan apparently sat on the story for some time which allowed a lot of people time to travel and spread the disease undetected. Reports are that someone could be infected for 14 days before showing any signs. Travel bans are hitting oil prices and the Chinese economy. On the first day of the Lunar New Year, civil air and rail travel was off about 41.6% and road traffic was down 25%. Shanghai Disneyland has shut its doors as have all the Starbucks outlets in Hubei province. Marriott, Hilton and Hyatt are waiving cancellation fees. Japan has pulled all its workers from Wuhan while President Xi has called the situation grave and suspended international travel from China.
Lost in all the hubbub of impeachment and pestilence was first test flight for the new Boeing 777X which will be the replacement for the 747.