Stock market live Monday: Stocks close in the green, Buffett dumps airlines, tech gains

This is a live blog. Check back for updates

The market has rallied furiously from its March low, but the comeback may have run out of steam, according to Stephen Suttmeier, Bank of America’s technical research strategist. The S&P 500’s 12.7% gain in April marked the best month since January 1987, but the equity benchmark has retreated after hitting a key resistance zone of 3,000 to 3,027. “After equities floated like a butterfly with a solid April rally, bearish weekly candles last week …  have stung like a bee, increasing the risk for an interim top and corrective phase for US equities entering the seasonally weak month of May,” Suttmeier said. The S&P 500 closed at 2,830.71 on Friday. – Li

Media analyst Michael Nathanson cut his price target on Disney by $8 and downgraded the stock to neutral from buy. He said in a note that others on Wall Street are underestimating how long the economic hit to the entertainment giant will last, with theme parks in particular facing a multi-year recovery. Shares were more than 3% lower in premarket trading. —Pound

Evercore ISI portfolio strategist Dennis DeBusschere wrote Monday that geopolitical tensions between the U.S. and China are beginning to supersede Covid-19 as the market’s main source of angst. Reports that the Trump administration is moving to remove global industrial supply chains from China, and worries that their trade deal could fail, are weighing on commodity cyclicals. Deaths and new Covid-19 case growth, the strategist said, are at their lowest levels in two months across Spain, Italy and Germany, increasing optimism over economic reopening.

“Covid risk [is] being replaced by geopolitical tension,” DeBusschere, who has been tracking the incremental coronavirus developments closely for clients, wrote Monday. “Risk assets are lower on reports the Trump administration is ‘turbocharging’ an initiative to remove global industrial supply chains from China and that the trade deal is falling apart.” — Franck

Phase one of Florida’s reopening begins Monday across the state, apart from in the three hardest-hit counties: Miami-Dade, Broward and Palm Beach. Restaurants and stores can open their doors again – at reduced capacity – and voluntary surgeries can once again be scheduled. People must continue to practice social distancing, however, and bars, gyms and schools remain closed. New Hampshire, Montana, Colorado and Indiana are among the other states that will begin easing restrictions on Monday.

For a state-by-state guide to reopening plans, click here. – Stevens

“Looking at these sales can also provide insights into the mind of one of the greatest investors of all time,” wrote Bill Stone, chief investment officer at Stone Investment Partners. “Buffett was willing to take a loss when the facts changed… Second, the investing process is about probabilities and he observed that a ‘low probability risk ended up happening.’ Third, he eliminated the entire position when he became ‘uncertain about the future’ of industry profitability rather than just trimming the positions.”

Stone noted Buffett did not imply this was a market call. The investor also pointed out Buffett still has exposure to the aerospace industry through businesses Berkshire owns including Precision Castparts, FlightSafety and NetJets. – Melloy

The market is expected to be choppy as investors grapple with a slew of pandemic-related developments, according to Mark Haefele, chief investment officer at UBS Global Wealth Management.

“We expect stocks to remain volatile as markets struggle to find a balance between announcements on the lifting of lockdowns, data on potential treatments and vaccines, economic releases, news on the course of the pandemic, and changing political dynamics,” Haefele said in a note on Monday. The strategist said investors should remain positioned for upside in stocks, but also “sufficiently diversified to protect against potential negative surprises.” – Li

Secretary of State Mike Pompeo said Sunday on ABC’s “This Week” that while he does not believe the coronavirus was deliberately spread in China, the country “has a history of infecting the world, and they have a history of running substandard laboratories.”

“These are not the first times that we’ve had a world exposed to viruses as a result of failures in a Chinese lab,” Pompeo said. “And so, while the intelligence community continues to do its work, they should continue to do that, and verify so that we are certain, I can tell you that there is a significant amount of evidence that this came from that laboratory in Wuhan.” Trump had previously speculated that China may have unleashed the coronavirus due to some kind of horrible “mistake.” His intelligence agencies say they are still examining a notion put forward by the president and aides that the pandemic may have resulted from an accident at a Chinese lab.

Experts say the virus arose naturally in bats, and make it clear that they believe it wasn’t man-made. Many virologists say the chance that the outbreak was caused by a lab accident is very low, though scientists are still working to determine a point at which it may have jumped from animals to humans. – Stevens, AP

The fast-spreading coronavirus has infected more than 1.15 million Americans, more than any other country, according to Johns Hopkins University. U.S. President Donald Trump said on Sunday he was confident that a vaccine would be available by the end of 2020. More than 3.5 million people have now been infected worldwide by the coronavirus and over 247,000 people have died. Italy saw a slowdown in daily cases over the weekend. – Fitzgerald

The “Oracle of Omaha” Warren Buffett hasn’t made any big investments in several years as Berkshire Hathaway’s massive cash pile ballooned to a record $137 billion by the end of March. He said the reason is simply that he hasn’t found anything “attractive.”

“We have not done anything because we haven’t seen anything that attractive to do,” Buffett said at Berkshire’s annual meeting on Saturday. “We are not doing anything big obviously. We are willing to do something very big. I mean you could come to me on Monday morning with something that involved $30, or $40 billion or $50 billion. And if we really like what we are seeing, we would do it.” The billionaire investor said previously he was ready to make an “elephant-sized acquisition.” – Li

At Berkshire Hathaway’s annual shareholder meeting on Saturday, Warren Buffett said his conglomerate has sold all of its airline holdings because of the coronavirus pandemic. The prior stake, worth north of $4 billion in December, included positions in United, American, SouthWest and Delta Airlines. The sale marks a rare move for the buy-and-hold value investor.

“The world has changed for the airlines, and I don’t know how it’s changed and I hope it corrects itself in a reasonably prompt way,” he said. “I don’t know if Americans have now changed their habits or will change their habits because of the extended period.”

Demand for air travel has plunged since March as the virus and precautions like shelter-in-place orders keep potential passengers at home. Airline shares were the biggest losers in the S&P 500 in premarket trading. Delta, United Airlines, American Airlines and Southwest Airlines all lost more than 9%. – Li

U.S. stock index futures pointed to losses across the board at the open, extending markets’ rocky start to May. The Dow Jones Industrial Average was set to open nearly 300 points lower for a loss of 1.2%, while the S&P 500 and Nasdaq Composite were slated to decline 1% and 0.8%, respectively. Relations between the U.S. and China worsened over the weekend after Secretary of State Mike Pompeo said there was a “significant amount of evidence” connecting the coronavirus to a lab in the Wuhan region of China. Meanwhile legendary investor Warren Buffett said Saturday at his virtual annual shareholder meeting that Berkshire Hathaway is still sitting on its massive cash hoard because the conglomerate hasn’t found a company to buy at an attractive price.

The turn lower follows Friday’s underperformance, which saw the Dow and S&P 500 drop 2.5% and 2.8%, while the Nasdaq tumbled 3.2%. But it’s been a brief respite in an otherwise strong period for stocks. April was the best month since 1987 for the Dow and the S&P, while the Nasdaq saw its best month since 2000. – Stevens 

– CNBC’s John Melloy, Thomas Franck and Jess Pound contributed reporting.

Subscribe to CNBC PRO for exclusive insights and analysis, and live business day programming from around the world.