Global Economic Fears Drive Stocks Lower

Amazon's market cap went back above $1 trillion

Jan 31, 2020 at 2:30 PM
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Stocks started the week on a slow note due to ongoing concerns around the coronavirus, sending the Dow Jones Industrial Average (DJI) reeling and the Cboe Volatility Index (VIX) surging higher. This theme looks to be continuing as the week wraps up too, with the Dow eyeing a huge pullback at the time of this writing. Traders monitored another full slate of earnings releases along the way, as well as the decision from the Fed to keep rates steady.

Dow Drops in January; AMZN Tops $1 Trillion

With just hours left in the trading week as of this writing, Wall Street is entirely gripped by the coronavirus outbreak, as U.S. airlines begin to shut down flights to China as the virus continues to spread. Against this backdrop, the Dow is set for its first monthly loss since August.

Outside of the coronavirus worries, investors had earnings reports to monitor from a number of blue chips, including Friday's disappointing forecast from Caterpillar (CAT). Microsoft (MSFT) and Apple (AAPL), meanwhile, put out strong numbers, and fellow tech giant (AMZN) stole the show at the end of the week with its quarterly update that put its market cap back above the $1 trillion mark.

There were a number of major moves from the semiconductor space, which overall had a somewhat volatile week. Fan favorite AMD stock delivered a mixed earnings report, and Lam Research's (LRCX) results drove the stock to all-time highs.

February Stocks to Watch

Going forward, we could expect travel stocks to stay in focus due to the coronavirus outbreak, which could spell trouble for Booking (BKNG) and its historical tailwinds. If the travel sector sounds to volatile right now, we also identified a makeup name that could be due to rise.

More broadly, there's another busy week ahead for Wall Street, with Walt Disney (DIS) earnings set for release and the January jobs data due out. For strictly whether it's time to get behind stocks or not, we took a look at one bond exchange-traded fund (ETF) that seems to be saying now is a good entry point for bulls.


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