U.S. Stocks Fluctuate; Bond Yields Resume Drop: Markets Wrap

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(Bloomberg) — U.S. equities pared early gains and European shares remained lower as investors weighed the latest coronavirus developments following a selloff that wiped out most global equity gains for this year. Treasuries gained.

The opened higher before turning mixed, while the struggled to rebounded from only its third 1,000 point decline on record. Home Depot Inc (NYSE:). shares climbed after an earnings beat. Ten-year Treasury yields lingered near record-low levels, while European bonds were mixed. pushed lower again after Monday’s slide of nearly 4%.

“The markets are pricing in the what ifs of the coronavirus, not necessarily exactly what is,” said Schutte, chief investment strategist at Northwestern Mutual Wealth Management Co.

Declines in banks and food producers dragged the index lower. Japanese shares tumbled more than 3% as traders returned after a holiday, though the decline was less than the two-session slide on Wall Street while they were away. Stocks fell in China and Australia and pushed higher in South Korea and Hong Kong. The yen strengthened against the dollar for a third day.

Erratic market moves suggest investors remain on edge over the economic impact of the virus. The World Health Organization has held off from declaring a global pandemic even as cases surged in South Korea, Italy and Japan. Some traders may be taking encouragement from news about the development of treatments, even if experts warn it would take time to build stocks of medicines. Fujifilm Holdings Corp. and Moderna Inc. are among companies experimenting with treatments or vaccines.

Meanwhile, Mastercard Inc (NYSE:). and United Airlines Holdings Inc. emerged as the latest companies to warn that profits are getting hurt as the disease spreads beyond its center in China’s Hubei province. Analysts at Oxford Economics Ltd. said the epidemic could wipe more than $1 trillion from global domestic product, while the International Monetary Fund lowered its growth forecasts for the world economy.

“The market is flying blind with this virus and how things play out from here,” said Peter Boockvar, chief investment office at Bleakley Financial Group. “The only two certainties is that the current economic impact is profound globally and that the virus will eventually go away and things will bounce back. What happens in between is impossible to say.”

Elsewhere, iron ore futures fell as steel inventories surged to a record in China and investors continued to weigh the impact of the coronavirus outbreak. Gold retreated from the highest level since 2013.

These are some key events coming up:

  • Earnings keep rolling in from companies including: Peugeot SA (PA:) on Wednesday; Baidu Inc (NASDAQ:)., Best Buy Co (NYSE:). Inc., Occidental Petroleum Corp (NYSE:). and Dell Technologies Inc. on Thursday; and London Stock Exchange Group (LON:) Plc on Friday.
  • The Democratic presidential debate in South Carolina is on Tuesday.
  • The Bank of Korea announces its policy decision on Thursday, with rising risks of an interest-rate cut.
  • U.S. jobless claims, GDP and durable goods data are out Thursday.
  • Japan industrial production, jobs, and retail sales figures are due on Friday.

These are the main moves in markets:

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