Coronavirus infects markets, Netflix reports
Asian markets slipped overnight Tuesday, then North American indices shed gains as fears of a new disease from China, the coronavirus, reached investors. The coronavirus could not come at a worse time, with millions of Chinese returning home to celebrate the Lunar New Year in vast numbers on par with American Thanksgiving and Canadian Christmas). Vacation stocks got punished: MGM Resorts International -6.22%, Wynn Resorts -6.44% and Royal Caribbean Cruises -3.98%, for example.
Fortunately, investors didn’t stampede the exits Tuesday, with the Dow declining a moderate 0.56% and the TSX losing 0.29%. Gold and crude also lost ground along these levels. Needless to say, investors will keep an eye on the coronavirus, as reports about the first case in the U.S. have surfaced.
Meanwhile, earning season continued. Before the opening bell, Toronto toymaker, Spin Master, warned of soft earnings due to a shortened American holiday season, the trade war and distribution problems. Spin Master shed nearly 5% on Tuesday. After the closing bell, Netflix released its much-anticipated quarterly. Though trading down 0.46% during the day, after hours the streaming giant popped 2.5%. Net subscribers, revenues and EPS were way up, beating expectations and putting to rest bearish fears that fresh competition would hurt Netflix. The stock will likely pop up Wednesday morning.