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Stocks - S&P Ends off Lows in Wild Ride as WHO Calms Virus Jitters

By Yasin Ebrahim – The S&P ended the day well off of its lows Thursday after the World Health Organization suggested the spike in coronavirus infections may not have occurred in a day, easing fears of contagion.

The S&P 500 fell 0.18%, Nasdaq Composite slipped 0.14% and the Dow Jones Industrial Average lost 0.43%.

"We are not dealing, from what we understand, with a spike in cases of 14,000 on one day," the WHO said in a press release after China reported 254 more deaths and 15,152 new infections.

The health watchdog said the surge in infections likely included individuals who had been infected a number of days or even weeks ago after China adopted a new method of diagnosing Covid-19 (coronavirus).

Ahead of the WHO's remarks, stocks were deeply in the red amid fears the jump in infections and deaths in China signaled a change in trajectory for the virus, stoking worries about contagion.

The Centers for Disease Control and Prevention confirmed the fifteenth case of an individual in the U.S. with the virus.

The major indexes had made it into the green in afternoon trading, but weakened when the Federal Reserve said it will shrink its repurchase agreement operations further as of tomorrow's overnight offering. Any hint the Fed is taking the punch bowl away tends to result in knee-jerk selling.

Earnings also influenced direction, with industrials taking hit from a slump in shipbuilder Huntington Ingalls.

Huntington Ingalls Industries (NYSE:HII) slipped about 7% after its fourth-quarter results fell short of estimates.

Cisco Systems (NASDAQ:CSCO) fell more than 5% as investors expressed concerns over growth after the company’s earnings beat was driven by its services rather than the higher-margin switching products segment.

Energy, meanwhile, failed to hitch a ride on a sharp upswing in oil prices amid growing hopes Russia will back the OPEC plan to cut output in the wake of Covid-19's hit to Chinese oil demand.

Not everyone is convinced that action from OPEC and its allies will be enough to offset the virus' impact on oil demand.

"Global oil stocks to pile up as proposed (600,000 bpd) OPEC cuts are no match for coronavirus-induced surplus," Rystad Energy said.

Elsewhere, Tesla (NASDAQ:TSLA) climbed 4.7% after an initial drop on news the electric automaker plans to raise $2 billion through an equity placing

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