US stocks climb higher as earnings season begins: April 14, 2020

By CNN Business

Updated 4:45 p.m. ET, April 14, 2020
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4:32 p.m. ET, April 14, 2020

The Dow and the S&P 500 are at their highest level in a month

From CNN Business' Anneken Tappe

The Dow and the S&P 500 rallied on Tuesday and closed back at a level not seen for more than a month.

The Dow finished at 23,950 points, while the S&P climbed to 2,846 points, the highest level for both indexes since March 10.

Half-way through April, the stock benchmarks are also on track for a monthly gain, retracing some of their catastrophic losses in March.

4:33 p.m. ET, April 14, 2020

Stocks finish higher

From CNN Business' Anneken Tappe

US stocks closed higher on Tuesday amid optimism over better-than-expected trade data from China.

  • The Dow finished 2.4%, or 559 points, higher.
  • The S&P 500 closed up 3.1%.

The Nasdaq Composite staged its longest winning streak – four days – since early February.

The index closed up nearly 4%.

It has now bounced back more than 20% from its low point on March 23. But whether the Nasdaq has fully emerged from a bear market won’t be clear for another few months.

2:12 p.m. ET, April 14, 2020

The Nasdaq is on track for its longest win streak in more than two months

From CNN Business' Anneken Tappe

Stocks are up this afternoon and the Nasdaq Composite is on track for its fourth day of gains.

That would be the longest winning streak since early February. It was last up 3.9%, which would be its biggest gain in just over a week.

The tech-heavy index is boosted by consumer and technology stocks.

12:13 p.m. ET, April 14, 2020

Here's why fixed income will rebound faster than stocks

From CNN Business' Anneken Tappe

The stock market may have bounced back from its worst lows and plenty of bad news is already priced in, but it still might not be the right place to be invested during the coronavirus recession.

"Since the third week of March we’ve been very aggressively going from zero exposure to credit to a large overweight in credit," Alessio de Longis, senior portfolio manager at Invesco Investment Solutions.
"Our philosophy there is credit markets are the first markets to lead out of a recession. They react first to monetary stimulus and an improvement to financial conditions."

Fixed income investors have claims on company assets senior to those of stock holders should a business file for bankruptcy.

The stock market, meanwhile, is more responsive to earnings, which typically are a lagging indicator and likely to be abysmal in the quarters to come, de Longis said.

It's hard to tell how much or what exactly is priced in to stock prices, he added, and markets could be reacting to all sorts of headlines. For now, de Longis said, "I think the market will mostly focus on the news about a vaccine and the reopening of the economy."

12:08 p.m. ET, April 14, 2020

Stocks extend gains at midday

From CNN Business' Anneken Tappe

US stocks are going strong at midday, having extended their gains since the open.

The Nasdaq has now climbed more than 20% from his March 23 low, entering a bull run in a bear market. Whether the index has fully emerged from the bear market it entered last quarter won't be clear for another few months.

11:32 a.m. ET, April 14, 2020

US economy will bear scars through 2021, says IMF's chief economist

From CNN Business' Pamela Boykoff and Matthew Friedman

It's "highly unlikely" the US economy will bounce back to pre-coronavirus growth levels by the end of this year, the International Monetary Fund’s Chief Economist Gita Gopinath said at the opening of the fund's Spring meeting. She described the current US recession as a deep one.

It is a recession that involves solvency issues. It is a recession that involves unemployment rates going up dramatically. And these tend to leave scars.

The IMF projects that if the virus is contained by summer and the recovery begins in the second half of this year, US growth will contract 5.9% in 2020 and grow by 4.7% in 2021.

11:41 a.m. ET, April 14, 2020

Stocks open higher as earnings season kicks off

From CNN Business' Anneken Tappe

US stocks climbed higher at the opening bell as better-than-expected trade data from China lifted investors' hopes that the world's second-largest economy may be starting to bounce back.

Meanwhile, first-quarter earnings season got underway with the big banks reporting. JPMorgan (JPM) and Wells Fargo (WFC) both reported substantial losses and shored up their reserved to prevent more pain during the coronavirus recession. But that was widely expected, and their shares climbed 3% and 2%, respectively, at the market open.

9:35 a.m. ET, April 14, 2020

Roughly a quarter of Marriott's 7,300 hotels are closed

From CNN Business' Jordan Valinsky

The coronavirus crisis is crushing Marriott's (MAR) business and it's only going to get worse, the company warned.

Marriott revealed that 25% of 7,300 hotels are currently closed and it expects even more closures in the near future. It doesn't expect improvement until "there is a view that the spread of Covid-19 has moderated and governments have lifted restrictions."

Occupancy rates in North America are around 10% with 16% of its roughly 5,300 hotels being temporarily closed.

The world's largest hotel chain said it can't yet measure the "financial impact of this unprecedented situation" and "expects that it will continue to be material to the company's results."

But the company said it expected a 60% decline in revenue per available room in March and 23% during the first quarter.

Marriott also said that it drew down $1.5 billion on its line of credit. Shares rallied 4% in early trading.

8:55 a.m. ET, April 14, 2020

Global airline losses to surpass $300 billion this year

From CNN Business' Jordan Valinsky and Greg Wallace

International Air Transport Association, an international aviation group, now expects worldwide losses due to the coronavirus to increase 25% from its previous estimates because of the ongoing coronavirus pandemic.

The group now estimates worldwide losses to top $314 billion this year, up from the $252 billion in losses it previously predicted.

IATA said Tuesday that worldwide travel has plummeted by 80%, much deeper than its earlier predictions. 

It said the industry is “virtually grounded outside [the] US.” Stimulus from the US government requires airlines to continue a minimal level of domestic service. 

The group forecasted travel in North America will drop 36% from last year’s levels, and passenger revenues will drop 64%. 

US airlines are currently experiencing a 94% drop in passenger volumes and have cut capacity by more than 70%, according to data from the airlines. 

The good news for the industry, according to IATA economist Brian Pearce, is that there's a "large amount of pent up demand" when travel restrictions are lifted.