Wall Street opens lower as virus lingers, Apple suffers

Traders work at the New York Stock Exchange February 4, 2020. — Reuters pic
Traders work at the New York Stock Exchange February 4, 2020. — Reuters pic

NEW YORK, Feb 18 — US stock markets opened lower today on the first day of trading from the long holiday weekend, after Apple warned its results would suffer from the viral outbreak in China.

Nearly 1,900 people have died and more than 72,000 others have been infected by the virus that broke out in China and has since spread to some 25 countries, causing airlines to cut flights to China and many businesses to shutter operations.

All three major US indices posted gains last week even as traders were vigilant throughout for more serious disruptions from the COVID-19 illness.

But this morning, the benchmark Dow Jones Industrial Average was down 0.4 per cent to 29,288.51 points after about 30 minutes of trading.

The tech-rich Nasdaq slipped 0.1 per cent to 9,717.22 points, and the benchmark S&P 500 declined 0.2 per cent to 3,372.03.

US tech giant Apple fuelled the drop after announcing it expects a financial hit from the epidemic, causing revenue in the current quarter to come in below forecasts as supply of its top-selling iPhone is constricted.

Apple shares were down around 2.3 per cent, but Michael Walkley, an analyst at Canaccord Genuity, did not believe the gloom would last.

“Despite the COVID-19’s impact on Chinese iPhone demand and supply chain disruptions near-term headwind, we believe Apple is performing strongly across all business lines,” he said in a note.

Before trading commenced, Walmart announced weak fourth quarter earnings that were battered by unrest in Chile, a key market, as well as disappointing toy and clothing sales during the Christmas shopping season.

But the largest private employer in the United States did not — so far — forecast any bad news from the new coronavirus outbreak and its shares rose 0.5 per cent when markets opened. — AFP

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