China returns to business as western markets rebound
Chinese markets returned to business after the Lunar New Year. To little surprise, the Shanghai composite plunged 7.72% on its first day back, its sharpest drop in four years. As Chinese authorities race to contain the virus, European markets rose overnight Monday by half-a-percent, and North American indices rebounded sharply, with the Nasdaq climbing 1.34%.
The TSX, which has been less volatile than its New York peers, gained 0.3%, burdened by a 3.2% drop in crude oil. The VIX fell 4.62% to illustrate that investors calmed down over the weekend following Friday’s sell-off. The rally reached almost across the board. Companies that rely on Chinese consumers enjoyed generous gains. For instance, Nike bounced up 3.08% to settle just below $100 (see our weekly report for more analysis). However, that paled next to Tesla. The e-car company soared 20% after one analyst increased his price target from $556 to $808.
Earnings season continues. Amazon‘s revenue disappointed, though it handily beat EPS expectations. Amazon inched down 0.23% Monday and was flat in the immediate after-hours. There was better news at Enbridge. Minnesota approved the expansion of Line 3, delayed after a year. Also, luxury clothing line Canada Goose soared 4.29% as it announced supermodel Kate Upton as its new spokeswoman.