Dow Falls 208 Points on China Slowdown Fears

Oil prices dropped after disappointing Chinese industrial data

by Karee Venema

Published on Jan 28, 2019 at 4:33 PM

Stocks dropped out of the gate, on dismal guidance from construction heavyweight Caterpillar (CAT) and chipmaker Nvidia (NVDA), with both citing weak demand out of China. Sinking oil prices and reports of massive lost revenue for the U.S. because of the government shutdown only added to the risk-off backdrop. At the close, the Dow, S&P 500, and Nasdaq were all in the red, and a key VIX moving average edged higher.

Continue reading for more on today's market, including:

The Dow Jones Industrial Average (DJI - 24,528.22) was down more than 413 points at its session low, before closing with a 208.9-point, or 0.8%, loss. Caterpillar (CAT) paced the 24 Dow losers with its 9.1% drop, while DowDuPont (DWDP) and Johnson & Johnson (JNJ) led the six advancers, adding 0.6% apiece.

The S&P 500 Index (SPX - 2,643.85) closed down 20.9 points, or 0.8%, while the Nasdaq Composite (IXIC - 7,085.69) gave back 79.2 points, or 1.1%.

The Cboe Volatility Index (VIX - 18.87) topped 20 in intraday action, before settling with a slimmer 1.5-point, or 8.3%, gain.

Closing Indexes Summary Jan 28

NYSE and Nasdaq Jan 28

5 Items on our Radar Today

  1. Former Starbucks CEO Howard Schultz tested the presidential waters, saying in a 60 Minutes appearance last night he is "seriously thinking about running for president" as a "centrist independent." President Donald Trump was quick to chime in, tweeting "Howard Schultz doesn't have the 'guts' to run for President!" (Vox)
  2. In a statement released earlier today, Senator Marco Rubio said the U.S. will issue sanctions on Venezuela's state-owned oil company Petroleos de Venezuela (PDVSA). The move comes after the White House last week threw its support behind opposition leader Juan Guaido, with the Republican from Florida saying, "The Maduro crime family has used PDVSA to buy and keep the support of many military leaders." (CNBC)
  3. GameStop dropped on reports of an Apple video game subscription service.
  4. Why Credit Suisse thinks GrubHub stock can rally more than 60%.
  5. Blackberry broke its three-day winning streak on C-suite news.

Corporate Earnings Jan 28

Unusual Options Activity Jan 28

Data courtesy of Trade-Alert

Gold Gains on Dovish Fed Expectations

Oil prices plunged today as Caterpillar's weak forecast and dismal industrial profit data out of China stoked fears of a slowing global economy. Crude for March delivery dropped $1.70, or 3.2%, to settle at $51.99 per barrel.

Sinking stocks boosted gold's safe-haven appeal, while low expectations of a Fed rate hike only strengthened tailwinds. February-dated gold -- the most active contract today -- jumped $5, or 0.4%, to settle at $1,303.10, while April futures, the most heavily populated gold contract, closed up $5.10, or 0.4%, at $1,309.30 an ounce.

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