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* Airlines, travel stocks hit by China virus fears
* Boeing the biggest drag on Dow
* Netflix drops, IBM rises after-hours after posting results
* Indexes down: Dow 0.52%, S&P 0.26%, Nasdaq 0.19%
(Updates to market close)
By Stephen Culp
NEW YORK, Jan 21 (Reuters) - Wall Street lost ground on
Tuesday, backing away from record highs as a viral outbreak from
China found its way to U.S. shores and the International
Monetary Fund (IMF) lowered its global economic growth forecast.
All three major U.S. stock averages fell following several
days of record closing highs and their best one-week advance in
months.
The indexes extended their losses after the Centers for
Disease Control and Prevention confirmed the first U.S. case of
the coronavirus, which has now killed six people in China.
"We're seeing headline risk introduced to the market and any
time there's new uncertainties, we see more volatility and
flight to quality and investors fleeing risk assets," said
Charlie Ripley, senior market strategist for Allianz Investment
Management in Minneapolis.
"Today's news around the coronavirus is a reminder that
risks remain, and it's something that investors will be paying
attention to in the coming weeks and months," Ripley added.
With the outbreak occurring just before the Chinese lunar
new year, the news hit travel-related stocks the hardest.
The NYSE Arca Airline index .XAL dropped 2.8%.
United Airlines UAL.O fell by 4.4%, while Carnival Corp
CCL.N dipped 2.3%.
Hotel and casino operators Las Vegas Sands Corp LVS.N and
Wynn Resorts Ltd WYNN.O , both of which have sizable operations
in China, ended the session down 5.4% and 6.1%, respectively.
Steel stocks, which have a sizable exposure to China, also
fell. United States Steel Corp X.N was down 5.2%. Boeing Co BA.N weighed heaviest on the blue-chip Dow, its
shares falling 3.3% following reports the planemaker's 737 MAX
might not win approval to return to service until June or July.
In other news, the IMF trimmed its global economic growth
forecasts for 2020 and 2021, with Managing Director Kristalina
Georgiev citing lasting effects from the bruising U.S.-China
trade war and sharper-than-expected slowdowns in India and other
emerging markets.
The Dow Jones Industrial Average .DJI fell 152.06 points,
or 0.52%, to 29,196.04, the S&P 500 .SPX lost 8.82 points, or
0.26%, to 3,320.8 and the Nasdaq Composite .IXIC dropped 18.14
points, or 0.19%, to 9,370.81.
Of the 11 major sectors in the S&P 500 seven ended the
session in the red, with energy .SPNY , industrials .SPLRCI ,
and materials .SPLRCM suffering the largest percentage drops.
Real estate .SPLRCR led the gainers.
Fourth-quarter earnings season continues apace, with 46 of
the companies in the S&P 500 having reported. Of those, 71.7%
have beaten analyst expectations.
Members-only chain store Costco Wholesale Corp COST.O
advanced 2.8% after Oppenheimer upgraded the shares to
"outperform." Intel Corp INTC.O gained 1.6% after three brokers raised
their price targets for the chipmaker's shares. Electric automaker Tesla Inc TSLA.O rose 7.2% after new
Street Research hiked its price target to $800 per share.
Netflix Inc NFLX.O shares fell more than 1% in after-hours
trading after posting fourth-quarter results.
International Business Machines Corp IBM.N rose more than
4% after the bell after reporting a surprise revenue increase on
cloud growth.
Declining issues outnumbered advancing ones on the NYSE by a
1.56-to-1 ratio; on Nasdaq, a 1.59-to-1 ratio favored decliners.
The S&P 500 posted 89 new 52-week highs and two new lows;
the Nasdaq Composite recorded 140 new highs and 37 new lows.
Volume on U.S. exchanges was 8.13 billion shares, compared
with the 7.02 billion-share average over the last 20 trading
days.