Stocks – Wall Street Rebounds From Early Weakness as Tech Shines

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By Yasin Ebrahim – Wall Street rebounded from early weakness on Monday, led by a surge in tech stocks, though concerns about the risk to global growth from the coronavirus kept a lid on gains.

The rose 0.30%, added 0.64% and the gained 0.20%.

With the death toll from the coronavirus rising to 909, and new cases of the virus emerging in France and the U.K., the World Health Organization warned that a rise in cases outside of China could be the “spark that becomes a bigger fire”.

But U.S stocks turned positive as investors continued to bet the economy will remain resilient in the wake of the last week’s better-than-expected jobs report.

“We expect the novel coronavirus to have a negative impact on the overall Chinese economy, and, potentially slowing China’s GDP growth by 100-to-200 basis points in the first quarter of the year,” DA Davidson said.

But “based on the SARS impact in 2003, we believe that economic growth will rebound rapidly, after the nCoV outbreak is contained,” the firm added.

The rebound on Wall Street was led by tech stocks, with chip stocks, in particular, racking up sharp gains for the day.

Nvidia (NASDAQ:) surged 4% ahead of its earnings due Thursday, buoyed by a price target boost from RBC to $301 From $258.

“We raise our estimates on NVDA as we think the January quarter will come in a bit ahead of the high-end of guide due to better-than-expected gaming and data center demand,” RBC said in a note.

A rise in consumer discretionary, led by (NASDAQ:), also supported sentiment on stocks.

Energy stocks, however, kept the broader-market advance in check as oil prices continued to fall on concerns about the impact of the coronavirus on oil demand.

Elsewhere, Tesla (NASDAQ:) pared some gains, but was up 1% after the electric automaker reportedly restarted production at its China factory.

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