Dow futures up 150, Cramer not buying it, Micron falls

Finance


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8:01 am: Global bond yields slide as coronavirus fears remain

The U.S. 10-year Treasury yield hit a low of 1.347%, its lowest level since July 8, 2016 as investors remained cautious amid lingering worries over the coronavirus. The benchmark rate also traded below its all-time closing low around 1.36%. The 2-year U.S. rate dipped to 1.235%, its lowest levels since May 18, 2017. Germany’s benchmark yield fell to levels not seen since Oct. 10. —Imbert, Francolla

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7:59 am: Futures point to triple digit gain at the open

U.S. stock index futures picked up steam, with the Dow Jones Industrial Average set to post a 164 point gain at the open. The S&P 500 and NASDAQ also indicated gains at the start of the session. On Monday the Dow sank more than 1,000 points, for its worst point and percentage drop since February 2018. The S&P 500 plunged 3.3%, also the worst drop in two years. With Monday’s declines, the S&P 500 and the Dow both wiped out all of their 2020 gains. – Stevens

7:55 am: Market ‘panic attack’ may not be over, Ed Yardeni says

Futures may be pointing to a slight rebound, but strategist Ed Yardeni thinks the “panic attack” that led to the Dow falling more than 1,000 points Monday may not be over. “It has the potential to turn into one of the more severe corrections of the current bull market,” he wrote in a note. “It could turn into a bear market if it causes a recession in the US.” —Imbert

7:35 am: Home Depot jumps 2% after earnings beat estimates

Shares of Home Depot rose more than 2% in Tuesday’s premarket trading after the company beat top and bottom line estimates in the fourth quarter. Earnings per share came in at $2.28, which was ahead of the $2.10 analysts had been expecting, according to estimates from Refinitiv. Revenue was $25.78 billion, which was slightly ahead of the $25.76 billion expected. Revenue did, however, fall 2.7% year-over-year. Same-store sales rose 5.2%, which also surpassed the expected 4.8% increase, and the company also hiked its dividend by 10%. – Stevens

7:26 am: Apple bouncing slightly

Shares of Apple, which has the most on the line in China among the largest U.S. stocks, were bouncing slightly, up 0.7% in premarket trading following a 4.75% slide on Monday. Many analysts are weighing in following the drop. UBS says that the 2020 demand picture is in flux now, but 2021 is more important for the stock anyway with new phones set to be launched this fall. “We believe there is still no reason to become materially more cautious on 2021 expectations,” the UBS analyst wrote, maintaining a buy rating. Needham is slightly more cautious, though still maintains its buy rating. “The longer COVID-19 disruptions continue past June 1, the greater the threat to AAPL’s Sept new product launches (including its 5G phone) and Christmas selling season revenue, which represented about 32% of annual revs in each of the past 3 years.” – Melloy

7:25 am: BMO says investors shouldn’t be pressing the ‘panic button’ just yet

The Dow and S&P 500 are now negative for the year after stocks’ steep slide on Monday, but BMO Capital Markets said things might not be as bad as they seem. “While the coronavirus certainly warrants persistent monitoring in the coming months, we do not believe investors should be pressing the panic button just yet,” chief investment strategist Brian Belski wrote in a note to clients. He argued that the market isn’t showing the “tell-tale signs” that an earnings deterioration is imminent. He did note that specific areas are being notably affected, but that even these companies’ longer-term fundamental outlooks “have largely remained intact.” – Stevens

7:07 am: Mastercard shares lower amid coronavirus warning, executive change

7:03 am: El-Erian says ‘this is different,’ warns against buying the dip

Economist Mohamed El-Erian said on CNBC’s “Squawk Box” that he’s advising investors against buying the coronavirus-induced dip. “I stress, this is different,” the Allianz chief economic advisor and ex-Pimco CEO said. He noted that while buying the dip is a well-known strategy on the Street, disruptions to corporate earnings and economic growth from “shock” events such as the coronavirus tend to impact stocks for longer than a fundamentals-driven downturn. – Belvedere, Stevens

6:57 am: Traders eyeing chipmakers Tuesday

It will be tough for any comeback rally to hold Tuesday without the help of the chipmakers, which have been among the hardest hit on the slowing global growth concerns stemming from the coronavirus outbreak. Micron shares were down 1% after Bank of America downgraded the stock to underperform and also cut its view on the whole memory chip industry because of the coronavirus effect on supply chains in China and South Korea. Bank of America thinks Micron will need to cut guidance in March. Elsewhere, Nvidia shares were downgraded to “reduce” by Instinet, also citing the coronavirus risks to the global semiconductor industry. Nvidia is slightly higher in premarket. – Melloy

6:55 am: ‘Don’t like to buy into a rally,’ Cramer says, negatives out there ‘can’t be overlooked’

In a series of tweets CNBC’s Jim Cramer noted that despite implied gains at the open, investors shouldn’t buy into this rally or make decisions based on futures. He said that the market is “not that oversold” and pointed to a number of unknows, including the coronavirus spreading from Milan to the United States, delays in a potential vaccine, as well as companies preannouncing EPS weakness. – Stevens

6:27 am: Futures point to muted gains at the open

Stock futures implied a positive open for the major averages, with the Dow Jones Industrial Average indicating a gain of 113 points at the open. This hardly makes up for Monday’s losses, however, which saw $1.7 trillion wiped from the global market with the Dow sliding 3.56%, or 1,031 points, and the S&P and NASDAQ shedding 3.35% and 3.71%, respectively. – Stevens

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