“Coronavirus News Infects Markets – FAANG Stocks Tank – Fear Gauge & Coronavirus Stocks Skyrocket” – Vista Partners Daily Market Recap For January 27, 2020

Even though The World Health Organization declined to declare the coronavirus situation as an international public health emergency last week, we now are seeing that the news & fear surrounding it are continuing to infect many more as the resulting death toll is being reported to be now more than 80 in China with 5 confirmed cases of the virus is confirmed in the U.S. The spread of this news and the associated unknown & unquantifiable risk that we are all taking seems to be wrapping itself around our fears and triggering a selloff that continued its valuation devouring act today across the markets.

The beloved and high flying FAANG stocks that have been leading the markets and our accounts tanked across the board today along with the information technology sector which fell -2.4%. Fear of economic slowdown grew along with fear of the slowdown of consumption of FAANG’s products and services as the news of the coronavirus infection increased. Facebook (FB) closed at $214.87/share, -1.41%, Amazon (AMZN) closed at $1828.34/share, -1.79%, Apple (AAPL) closed at $308.95/share, -2.04%, Netflix (NFLX) closed at $342.88/share, -2.91% & Alphabet (GOOG) closed at $1433.90/share, -2.24%.

The Nasdaq Composite ended at 9,139.318, -1.89%. The S&P 500 ended at 3,243.63, -1.57%. The Dow Jones Industrial Average ended at 28,535.80, -1.57%. The Russell 2000 moved lower by -1.09% ending at 1,644.14.

The “fear gauge” Vix (TVIX) ended at $53.90/share skyrocketing +20.45% into the close and traded in a range of $50.16 – $53.90.

On the flip side, we are seeing coronavirus related but not widely owned stocks moving amazingly higher including Inovio Pharmaceuticals (INO) closing at $5.32/share, +25.47%, Novavax, Inc. (NVAX) closing at $8.50/share, +9.87%, Vir Technology (VIR) closing at $24.78/share, +24.19% & Meridian Bioscience, Inc. (VIVO) closing at $11.50, +20.67%.

Economic Reports

On Monday we received the New home sales report which confirmed a drop by -.4% month/month in December to a seasonally adjusted annual rate of 694,000 units.

Investing & Inspiration

“As long as you enjoy investing, you’ll be willing to do the homework and stay in the game.” -Jim Cramer

“I rarely think the market is right. I believe non-dividend stocks aren’t much more than baseball cards. They are worth what you can convince someone to pay for it.” -Mark Cuban

“Michael Marcus taught me one other thing that is absolutely critical: You have to be willing to make mistakes regularly; there is nothing wrong with it. Michael taught me about making your best judgment, being wrong, making your next best judgment, being wrong, making your third best judgment, and then doubling your money.” -Bruce Kovner

“The policy of being too cautious is the greatest risk of all.” -Jawaharlal Nehru

“The only true test of whether a stock is “cheap” or “high” is not its current price in relation to some former price, no matter how accustomed we may have become to that former price, but whether the company’s fundamentals are significantly more or less favorable than the current financial-community appraisal of that stock.” -Philip Fisher

“I learned to avoid trying to catch up or double up to recoup losses. I also learned that a certain amount of loss will affect your judgment, so you have to put some time between that loss and the next trade.” -Richard Dennis

“The four most dangerous words in investing are: ‘this time it’s different.” -Sir John Templeton

“Money doesn’t make you happy. I now have $50 million but I was just as happy when I had $48 million.” -Arnold Schwarzenegger

Tomorrow

Tomorrow’s significant economic data report schedule will include the Conference Board’s Consumer Confidence Index Report for January, the Durable Goods Orders Report for December, & the S&P Case-Shiller Home Price Index Report for November.