Business Highlights
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Stock market rout deepens on virus worries; indexes lose 4%
NEW YORK (AP) — The Dow Jones Industrial Average sank nearly 1,200 points Thursday, deepening a weeklong global market rout caused by worries that the coronavirus outbreak will wreak havoc on the global economy. The S&P 500 has now plunged 12% from the all-time high it set just a week ago. That puts the index in what market watchers call a “correction,” which analysts have said was long overdue in this bull market, which is the longest in history. It was the worst one-day drop for the market since 2011, and stocks are now headed for their worst week since October 2008, during the global financial crisis.
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Investors shy away from risk as coronavirus rattles markets
LOS ANGELES (AP) — This week’s big sell-off on Wall Street suggests stocks have finally caught up to the bond market, where fear of an economic slowdown has been evident for months. Signs that the new coronavirus that originated in China is now spreading to other parts of the world rattled investors, intensifying worries about the damage that the outbreak could cause the global economy and corporate profits. That led anxious traders to dump stocks and to shovel more money into U.S. government bonds, driving bond yields to record lows. The move away from risk is a marked shift for traders as markets adjust to heightened volatility and uncertainty.
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Officials: Chinese industry recovering, more aid coming
BEIJING (AP) — Chinese regulators say small, mostly private companies that are the engine of the country's economy are back to operating at one-third of normal levels after anti-virus controls shut factories and other business. They promised more low-cost loans and other to get the world's second-largest economy functioning again. The ruling Communist Party has ordered areas of China that are low disease risk to revive manufacturing and other businesses that have been shut for a month. That comes at a time when outbreaks in South Korea, Italy and Iran have led to travel banks and other controls abroad.
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US economy grew at 2.1% rate in Q4 but virus threat looms
WASHINGTON (AP) — The U.S. economy grew at an annual rate of 2.1% in the final quarter of last year, but damage from the spreading coronavirus is likely depressing growth in the current quarter and for 2020 as a whole. The overall pace of growth in the October-December quarter was unchanged from its initial estimate a month ago. Economists have been downgrading their forecasts for the first quarter of this year as fears of the virus’ impact have escalated.
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Beyond Meat narrows 4Q loss as plant-based meat sales jump
EL SEGUNDO, Calif. (AP) — Beyond Meat narrowed its losses in the fourth quarter as sales of its plant-based meat soared. The El Segundo, California-based company, which went public last year, said it lost $452,000 in the fourth quarter, down from a loss of $7.5 million in the October-December period last year. The loss of 1 cent per share fell short of Wall Street's forecast of a profit of 1 cent per share, according to analysts polled by FactSet. Revenue more than tripled to $98.5 million, beating analysts' estimate of $81 million. Beyond Meat's shares fell 7% in after hours trading.
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Delivery giant DoorDash takes step toward public offering
NEW YORK (AP) — Food delivery giant DoorDash has taken a first formal step toward a stock market debut. The company announced Thursday that it has filed paperwork with the Securities Exchange Commission outlining its proposed public stock offering. There was no proposed date for an initial offering, which could be a long way off. Last year, rival Postmates delayed plans for an IPO, citing unfavorable market conditions. Analysts have said both DoorDash and Postmates are burning cash and need money-raising options as the third-party delivery business becomes more fragmented and competitive.
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US mortgage rates decline; 30-year loan at 3.45%
WASHINGTON (AP) — U.S. long-term mortgage rates declined this week as growing concern over the economic impact of China's viral outbreak spurred a steep downturn in global stock markets. Mortgage buyer Freddie Mac says the average rate for a 30-year fixed-rate mortgage fell to 3.45% from 3.49% last week. Rates are far below year-ago levels: the benchmark 30-year loan averaged 4.35% a year ago.
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US pending home sales climbed 5.2% in January
WASHINGTON (AP) — There was a 5.2% jump in Americans signing contracts to buy homes in January from the previous month. Lower mortgage rates and a solid economy are pushing up demand for housing. The National Association of Realtors said Thursday that its index of pending sales climbed to 108.8 last month. These contract signings — a barometer of finalized purchases over the next two months — have risen 5.7% over the past year.
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US orders for durable goods slip 0.2% in January
WASHINGTON (AP) — Orders to U.S. factories for big-ticket manufactured goods dipped in January, pulled down by decreased demand for cars, auto parts and military aircraft. The Commerce Department said Thursday that orders for durable goods slipped 0.2% last month after climbing 2.9% in December.
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The S&P 500 index fell 137.63 points, or 4.4%, to 2,978.76. The Dow Jones Industrial Average fell 1,190.95 points, or 4.4%, to 25,766.64. The Nasdaq dropped 414.29 points, or 4.6%, to 8,566.48. The Russell 2000 index of smaller company stocks lost 54.89 points, or 3.5%, to 1,497.87.