US stocks drop as coronavirus hits tourism shares

The New York Stock Exchange (NYSE) is seen on Wall Street in New York City in this file picture. — AFP pic
The New York Stock Exchange (NYSE) is seen on Wall Street in New York City in this file picture. — AFP pic

NEW YORK, Jan 25 — Wall Street stocks tumbled yesterday as news of additional coronavirus cases offset some positive earnings reports to finish the week on a negative note.

China expanded a massive quarantine effort yesterday, while the United States confirmed its second case of the SARS-like ailment. French officials said there had also been two cases found in France, the first in Europe.

Adam Sarhan of 50 Park Investments said the virus still appeared to be contained but “if we start getting more cases showing up around the world, that would be a bad sign for global economic growth.”

Sarhan said yesterday’s losses also reflected profit taking following a run of Wall Street records in recent weeks.

The Dow Jones Industrial Average finished down 0.6 per cent at 28,989.73.

The broad-based S&P 500 dropped 0.9 per cent to 3,295.45, while the tech-rich Nasdaq Composite Index also shed 0.9 per cent to 9,314.91, retreating from a record.

Tourism-oriented stocks were under pressure amid fears over the impact of the Chinese virus. United Airlines sank 3.5 per cent, Marriott International lost 2.7 per cent and Wynn Resorts fell 3.1 per cent.

American Express jumped 2.8 per cent after reporting better-than-expected fourth-quarter earnings on a solid holiday shopping season, while fellow Dow member Intel surged 8.1 per cent on higher profits as it boosted its dividend.

Another Dow component, Boeing, gained 1.7 per cent after a source confirmed that the Federal Aviation Administration could clear the 737 MAX to resume flights before mid-year.

Shares had fallen earlier in the day on worries the aviation giant could further trim production of its 787 Dreamliner plane, which has seen a drop in orders from China. — AFP

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