Stock market live updates: Dow up 300, oil plunges 20%, Gundlach shorting the market

U.S. equities rose modestly on Monday, clawing back from last week’s losses. A possible reopening of parts of the economy boosted investor sentiment. However, oil continued to fall on growing concerns that storage will soon reach capacity. Here’s whats happening. 

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Bank stocks helped push equities higher on Monday with JPMorgan rising 2.15% and Goldman Sachs gaining about 1.5%. Citi rose more than 2% and Bank of America ticked about 1.9% higher. Wells Fargo was the biggest winner among large U.S. banks, rising nearly 3% in early trading. Banks likely got a boost from rising interest rates, as investors ditched safe haven assets in hopes of the economy reopening. Last week, investor Steve Eisman said U.S. banks are an attractive investment following the coronavirus-induced market sell-off. — Fitzgerald 

Jim Cramer said on “Squawk on the Street” that the June futures contract for West Texas International crude will go to zero just like the May contract did last week. “This has to go to zero again, because we haven’t any more space,” Cramer said on “Squawk on the Street.” “I had, Herbjørn Hansson, who’s the CEO of the largest tanker company, Nordic American Tanker, on Friday, and he said look there’s no room. So why shouldn’t this number go to zero? It should go to zero faster than it did last time.”The June contract was trading at roughly $12 per barrel on Monday morning. — Pound

U.S. equities opened in positive territory on Monday, with the Dow Jones Industrial Average rising 120 points, or 0.55%. The S&P 500 jumped 0.75% and the Nasdaq Composite gained 0.92%. Boosting investor sentiment is the possibility of a partial reopening of the economy. — Fitzgerald 

Due to the economic ramifications of the coronavirus, earnings season has never been this trivial, according to Evercore ISI. “It’s hard for us to recall a time when earnings reports seemed less important,” Evercore technology analyst Benjamin Black told clients. “In the context of a global pandemic, 30-50% declines in GDP, and an uncertain shape of potential recovery – 1Q results will offer only a 2-week window of possible extrapolation into the current situation, and management teams will likely be reluctant to offer explicit forecasts amidst forces so far out of their control,” he added.  That said, the Wall Street firm is looking for earnings commentary about changes to investment plans to address revenue shortfalls and divergent trends in subscription businesses. —Fitzgerald 

Northwell Health in New York City started testing high doses of over-the-counter heartburn drug on patients with coronavirus infection, according to a Sunday report from the Science Magazine. As of Saturday, 187 patients in critical status including many on ventilators, have been enrolled in the trial, and the study aims for a total of 1174 people, the publication said. The drug famotidine is the active ingredient in over-the-counter heartburn Pepcid, and the study calls for nine times the heartburn dose. Billionaire investor Bill Ackman, who had sounded dire warnings about the pandemic, spotted the study and called its early results “promising.” – Li

Morgan Stanley’s Michael Wilson said in a note he is a bit more optimistic than others as early signs show the consumer is more resilient than feared. “The excesses of the prior expansion were centered in the corporate channel, meaning the consumer came into this recession in better shape than in the Great Financial Crisis,” Wilson said, adding: “The stimulus is directed right at the consumer this time and provides a bridge to the other side. This may be one reason why consumer confidence and individual investor sentiment don’t look as dire as corporate and institutional surveys.” —Imbert

Energy stocks came under pressure on Monday as oil prices continue to slide. The Energy Select Sector SPDR Fund, which tracks the sector and trades under the ticker ‘XLE,’ traded 0.3% lower during premarket trading. EOG Resources and Schlumberger each fell more than 1% on the heels of West Texas Intermediate’s more than 20% decline on Monday. WTI has plunged more than 70% this year, and with prices at historic lows producers are struggling to breakeven. On Sunday Houston-based Diamond Offshore Drilling filed for bankruptcy. – Stevens 

The iPhone maker is delaying the production of its phones that are supposed to be release later this year due to the coronavirus, according to the Wall Street Journal. Apple is pushing back production by about a month as the deadly virus dented consumer demand and interrupts manufacturing in Asia, the report said on Monday. Apple’s new iPhone has been long awaited due to its access to 5G. Shares of Apple rose slightly in premarket trading. — Fitzgerald 

Goldman Sachs said in a new note that the reliance of the stock market on a few mega-cap tech stocks could mean that the recent rally will stall. The five biggest stocks in the S&P 500 now account for 20% of the index’s market cap, making the market more concentrated that at the height of the tech bubble. — Pound

Oil prices fell again on Monday on growing concerns that storage will soon reach capacity. West Texas Intermediate for June delivery fell 24.3%, or $4.11, to trade at $12.88 per barrel, while international benchmark Brent crude traded 6.2% lower at $20.11 per barrel. Each contract is coming off its eighth week of losses in nine weeks. The coronavirus pandemic has cut worldwide demand by as much as one third, according to some estimates, and as producers continue to pump oil analysts say there will soon be nowhere to store it. “The storage clock is ticking for producers and we are approaching the final countdown if no further action is taken,” said Bjornar Tonhaugen, head of oil markets at Rystad Energy. – Stevens

Amazon’s robust profits will be dented by the coronavirus crisis as its money-making segments slow and the cost of doing business increases, according to R5 Capital. The Wall Street firm lowered its rating on Amazon to sell from buy, making R5 Capital the only firm on Wall Street that doesn’t recommend owning Jeff Bezos’ e-commerce giant. R5 Capital also slashed its price target to $1,987 per share from $2,408 per share, implying a 20% fall from Amazon’s closing price of $2,410.11 on Friday. ”With the stock, however, having appreciated meaningfully and reaching our $2,408 price target in the face of dramatically worsening current economic conditions and rising future uncertainty, we believe prudence dictates reducing exposure to the equity,” R5 Capital analyst Scott Mushkin said in a note to clients. R5 Capital said Amazon’s earnings on Thursday will show slower growth and higher expenses in 2020 and 2021. — Fitzgerald 

General Motors said on Monday it has suspended its quarterly cash dividend payments and its share buybacks to preserve cash amid the coronavirus crisis. Shares of GM dropped 2% in premarket trading following the announcement. “We continue to enhance our liquidity to help navigate the uncertainties in the global market created by this pandemic,” chief financial officer Dhivya Suryadevara said in a statement. The company also said it extended a three-year revolving credit agreement for $3.6 billion to April 2022.—Li

Communities in less populated areas of New York could start to reopen gradually around mid-May, according to a plan set forth Sunday by Gov. Andrew Cuomo. With coronavirus cases on the decline after weeks of social distancing measures, Cuomo said a phased reopening can start happening shortly after May 15. Industries including construction and manufacturing would be the first back to work, while restaurants and retail would be further back. Progress on the economic rebooting would be monitored every two weeks. New York City, where cases remain high, likely wouldn’t be opened until considerably later. – Cox

Shares of Beyond Meat jumped more than 2% in premarket trading on Monday, as the plant-based meat producer sees growing demand amid meat shortage fears. Beyond Meat soared a whopping 41% last week, posting its best weekly performance since going public in May. The stock extended its recent rally on Monday as investors shrugged off a downgrade from UBS. The bank slashed its rating on Beyond Meat to sell from neutral, saying the rebound doesn’t price in the risk of an economic downturn. – Li

Stocks that would benefit most from a reopening of the economy led the way higher on Monday morning. Airlines, one of the industries that took the hardest hit from the coronavirus, climbed higher in premarket trading with American Airlines, Delta and United all rising about 2%. Casino stocks were on the rise in premarket as MGM Resorts and Wynn gained 1.7% and 2.4%. Retailers also rebounded with Gap and Kohl’s jumping 1.8% and 2.5%, respectively. — Li

Stock futures jumped in early trading on Monday and pointed to gains at the open on hopes that some states will start to ease coronavirus-driven lockdowns. Dow Jones Industrial Average futures were up 219 points and implied an opening gain of around 208 points. S&P 500 futures rose 0.91% and Nasdaq 100 futures added 1.2%.

Last week, stocks experienced their first losing week in three, as oil plunged due to an evaporation of demand during the coronavirus crisis. The Dow lost 1.93%, the S&P 500 fell 1.32% and the Nasdaq Composite was down 0.18% for the week following oil’s historic plunge. OIl was falling again on Monday, down 17%.

— CNBC’s Jeff Cox, Pippa Stevens, Fred Imbert and Jesse Pound contributed reporting.

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