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Stocks End Higher as Wall Street Rebounds From Selloff

Stocks rebound from the worst one-day selloff since October as investors digest earnings reports from a series of blue-chip companies.
  1. Stocks finished higher Tuesday, rebounding modestly from the worst one-day selloff since October as investors digested earnings reports from a series of blue-chip companies.
  2. The economic impact of the deadly coronavirus, which has killed 106 people in China with infections surging to more than 4,500, continues to linger over markets.
  3. Apple is Real Money's Stock of the Day. The tech giant reports earnings after the closing bell Tuesday.

Stocks finished higher Tuesday as investors digested earnings reports from a series of blue-chip companies that could temporarily shift the market's focus away from the spread of the deadly coronavirus in Asia.

Also lifting sentiment was a stronger-than-expected U.S. consumer confidence report for January, largely due to optimism about the labor market, the Conference Board said.

Traders on Tuesday also were keying on the Federal Reserve as its Federal Open Markets Committee begins the first day of a two-day session. The central bank is expected to leave interest rates steady in its first meeting of 2020. An announcement from the Fed is expected Wednesday afternoon.

The economic impact of the deadly coronavirus, which has killed 106 people in China, with more than 4,500 confirmed infections, continues to linger over markets around the world, capping gains on Wall Street as investors move to safe-haven assets.

The Centers for Disease Control and Prevention advised U.S. travelers on Tuesday to avoid all non-essential trips to China. 

The Dow Jones Industrial Average finished up 187 points, or 0.66%, to 28,723, the S&P 500 gained 1.01% and the Nasdaq was up 1.4%. The tech sector was the standout Tuesday.

Apple (AAPL) , which was leading the Dow's advance, reports earnings after the closing bell Tuesday, along with Advanced Micro Devices (AMD) , eBay (EBAY) and Starbucks (SBUX) .

U.S. stocks finished sharply lower Monday and global markets tumbled as investors weighed both the human and economic costs of the accelerating spread of the virus. It was the Dow's biggest one-day selloff since October.

Pfizer  (PFE)  posted weaker-than-expected fourth-quarter earnings as sales from its UpJohn division, as well as a key pain treatment, fell sharply from a year earlier.

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Pfizer said it expects 2020 revenue in the range of $40.7 billion to $42.3 billion, and adjusted earnings in the range of $2.25 to $2.35 a share. 

3M  (MMM)  posted weaker-than-expected fourth-quarter earnings as industrial sales weakness offset strength in the company's health care division.

Looking into 2020, 3M said it expects organic, local-currency sales growth to be in the region of flat to up 2%, following a 2.6% decline during the fourth quarter, with reported earnings of between $9.30 and $9.75 a share. 3M also said it was ready to cut 1,500 jobs in a company-wide restructuring plan.

United Technologies  (UTX)  reported fourth-quarter and full-year earnings that handily beat analysts’ estimates, though it warned of headwinds related to the ongoing grounding of Boeing's  (BA)  737 MAX aircraft. 

Lockheed Martin's  (LMT)  fourth-quarter earnings beat estimates as F-35 sales supported aeronautics revenue in the defense company's ongoing battle with Boeing.

Harley-Davidson  (HOG) , the motorcycle maker, posted earnings that missed analysts’ forecasts due to the impact of China and European Union tariffs that took a bite out of U.S. sales.

Speaking of Apple, the tech giant has asked its suppliers to make up to 80 million iPhones over the first half of 2020, an increase of 10% from a year earlier, people familiar with Apple's planning told the Nikkei Asian Review.

Apple has booked orders for up to 65 million of its older iPhones, mostly from the iPhone 11 series, and up to 15 million units of a new cheaper model that it plans to unveil in March, Nikkei reported. Apple ordered about 73 million iPhones in the same period last year.

Suppliers warned, however, that Apple's supply chain could be hit by the spread of the coronavirus in China's Hubei Province. Apple's main manufacturing centers are in nearby Henan and Guangdong provinces.

Apple and Starbucks are holdings in Jim Cramer's Action Alerts PLUS member club. Want to be alerted before Jim Cramer buys or sells the stocks? Learn more now.

Durable goods orders jumped 2.4% in December but the Commerce Department said orders for non-defense capital goods excluding aircraft declined 0.9%. Economists had expected core durable goods to remain unchanged.