Stock market live Tuesday: Nasdaq jumps 4%, Amazon record, J&J vaccine hope

Signs that the coronavirus pandemic is easing drove stocks higher on Tuesday, even as the first batch of quarterly earnings showed the outbreak is taking a toll on corporate profits. Amazon notched an all-time high as investors bet on increased demand amid the nationwide shutdown. Here’s what happened:

• Nasdaq Composite closed up 3.95% for its fourth straight positive day for the first time since Feb 6 and its 4-day win streak
• Nasdaq is down 5.09% this year, on pace for its worst year since 2008 when it lost 40.54%
• Nasdaq is 13.4% from its intraday all-time high of 9,838.37 from Feb 19     
• Nasdaq is 28.42% off its 52-wk low of 6,631.42 from March  23
• Nasdaq 100 is only down 0.47% this year, led by Tesla up over 70% in 2020, Regeneron up almost 40% this year and Citrix up 39.7%
• S&P 500 closed up 3.06% for its third positive day in four
• S&P 500 is down 11.91% this year, on pace for its worst year since 2008 when the S&P lost 38.49%
• S&P 500 is 16.13% below its intraday all-time high of 3,393.52 from Feb 19
• S&P 500 is 29.85% off its 52-wk low of 2,191.86 from March 23
• Sectors: 10 out of 11 sectors were positive Tuesday led by Consumer Discretionary up 4.23%
• The least negative sector this year is Tech down 2.88% — Francolla

4:06 pm: Texas regulatory body holds hearing on production cuts

On Tuesday the Railroad Commission of Texas, which regulates oil and gas production in the state, held a hearing to discuss potential output cuts. As oil prices continue to fall, the curb in production was proposed by shale producers Pioneer Natural Resources and Parsley Energy. “Nobody wants to give us [the oil industry] capital because we have all destroyed capital and created economic waste,” Pioneer CEO Scott Sheffield said during the meeting. He said that independent producers need $30 oil to survive. At $20 per barrel, which is around where WTI traded on Tuesday, Sheffield argued that 80% of independents will go bankrupt. Marathon Oil Corp. CEO Lee Tillman, on the other hand, opposes the cuts. “Supply and demand imbalances will always occur” he noted, saying some companies will succeed, while others will fail. “We are facing a unique set of challenges, but the oil and gas industry will emerge stronger than before,” he added. The regulators were set to hear from 58 executives and energy experts. The meeting began at 10:30 a.m. ET, and by 4 p.m. less than half of the speakers had been heard from. – Stevens

The market built on its comeback on Tuesday as investors turned more hopeful that the coronavirus pandemic is leveling off. The Dow Jones Industrial Average climbed about 560 points, while the S&P 500 rose 3%, trimming its 2020 loss to about 12%. The tech-heavy Nasdaq Composite jumped nearly 4% as Amazon hit a new record high. Apple, Alphabet, Microsoft and Netflix all gained more than 4%. — Li

With less than one hour of trading left in the trading session, the major averages were headed for sharp gains as Wall Street resumed its massive rally from the March lows. The Dow traded more than 500 points higher, or 2.3%. The S&P 500 climbed 3% while the Nasdaq advanced 4%. Tuesday’s gains come after a decline in the previous session. —Imbert

Shares of Virgin Galactic surged as much as 31% in what would be the stock’s largest single-day gain since its market debut in October. Virgin Galactic shares jumped in trading after a headline noted that similarly-named Virgin Orbit had won a government contract. But Virgin Galactic does not have any ownership or stake in Virgin Orbit, a company that is developing rockets to launch small satellites. —Sheetz

Oil prices dropped on Tuesday as investors continue to fear that supply cuts won’t make a dent in the unprecedented demand loss from the coronavirus pandemic. U.S. West Texas Intermediate crude fell 10.26% to settle at $20.11 per barrel, having dropped 1.5% in the previous session. Brent futures fell $2.14, or 6.7%, to $29.60 per barrel after settling up 0.8% on Monday. Tuesday’s dip came as the Railroad Commission of Texas held an open meeting to discuss possible cuts in the state. The state accounts for roughly 40% of U.S. crude oil production. —Stevens

Piper Sandler analyst Jeffery Harte said on “Power Lunch” that he thought the struggles by bank stocks on Tuesday was mainly a reversion from last week, when the sector outperformed the broader market, and not a reaction to earnings results. “I think we’re seeing some of that unwind. I think it’s a little bit of buy the rumor, sell the news now that results are coming out. I didn’t think JPMorgan’s first quarter results were too bad … things looked fairly close to what we were expecting,” Harte said. Harte said he also was not concerned about the ability of the big banks to pay their dividends through the crisis. JPMorgan Chase and Wells Fargo both fell after reporting earnings Tuesday morning, and other banks such as Citi and Bank of America were also trading below where they closed on Monday. —Pound

JPMorgan Chase CEO Jamie Dimon said employers could sent workers back to the office by June at the earliest. “A rational plan to get back to work is a good thing to do, and hopefully it will be sooner rather than later,” Dimon said Tuesday in a conference call with analysts. “But it won’t be May. We’re talking about June, July, August, something like that.” —Son, Imbert

The Cboe Volatiltiy Index (VIX) — considered to be Wall Street’s preferred “fear gauge” — traded down 3.3 points, or more than 8% on Tuesday. That decline put it on pace for its first close below 40 since March 5, when it closed at 39.62. —Imbert

Amazon — Shares of Amazon rose nearly 4% to a new all-time high as the e-commerce giant experienced unprecedented demand amid coronavirus-related shutdowns nationwide.

Tesla — Shares of the electric automaker soared 12% following an upgrade to neutral from underperform at Credit Suisse. The firm said Tesla’s competitive advantage in the electric vehicle world has increased as the coronavirus disruption forces legacy automakers to make tough decisions about product investment.

JPMorgan — Shares of JPMorgan fell more than 4%, erasing earlier gains of more than 3%, as investors digested its first-quarter earnings that came in well below analysts’ expectations. The bank on Tuesday posted quarterly per share earnings of 78 cents, missing analysts’ $1.84 estimate, according to Refinitiv. However, its revenue proved to be more resilient, slipping 3% from a year earlier to $29.07 billion. JPMorgan’s trading division also posted a 32% increase in revenue to a record $7.2 billion. — Fitzgerald

Investors have headed to the sidelines, putting cash positions at the highest level since the Sept. 11, 2001 terror attacks, according to the Bank of America Fund Manager Survey for April. At the same time, pros have reduced stock allocations to the lowest since March 2009, the market bottom before the longest bull run in history. Also notable was a demand for balance sheet fortification, as just 5% of respondents want companies to use cash for stock buybacks, the lowest in 20 years. –Cox

New York Gov. Andrew Cuomo said in his daily coronavirus briefing that total hospitalizations and new hospitalizations declined in New York on Monday. There were 1,649 new hospitalizations on Monday, down from more than 3,000 on April 7. Total hospitalizations declined by 128, the first negative reading since the outbreak began.The state did suffer 778 deaths on Monday, bringing the total to at least 10,834. —Pound

Around midday, the major averages were up broadly as investors cheered the apparent progress in the fight against the coronavirus. The Dow was up about 420 points, or 1.8%. The S&P 500 gained 2.2% while the Nasdaq climbed 2.9%. President Donald Trump said in a press conference Monday that growth in new coronavirus infections stabilized, providing “clear evidence” that mitigation is working in the country. Meanwhile, the hospitalization rate in New York has stayed down —Imbert

• Bank of America raised its price target on Netflix to $460 from $426.
• Cantor Fitzgerald initiated Zoom as overweight.
• Credit Suisse upgraded Tesla to neutral from underperform.
• Cantor Fitzgerald initiated Slack as overweight.
• Citi downgraded Deere to neutral from buy.
• UBS downgraded Square to neutral from buy.
• Morgan Stanley upgraded Workday to overweight from equal weight.
• Citi upgraded Wynn to buy from neutral.

CNBC Pro subscribers can read more here. —Bloom

Shares of Boeing fell 4% to its session low after its customers cancelled 150 of 737 Max orders last month, deepening the crisis the company faces amid the coronavirus pandemic and the continued grounding of its best-selling plane after two fatal crashes. Brazilian airline Gol canceled 34 of the narrow-body planes and leasing firm Avolon scrapped orders for 75 of them. The decline in Boeing stock on Tuesday brought its massive loss this year to about 56%. –Li

JPMorgan Chase and Wells Fargo shares gave up earlier gains, trading lower around midmorning. Shares of JPMorgan were down 1.8% after rising as much as 3.9%. Wells Fargo was down 3.7% after climbing 3.4% earlier in the day. —Imbert

Shares of the hotel chain gained more than 5% on news of a new credit facility worth $1.5 billion. Marriott also said revenue per available room in the Greater China region was improving, adding group customers were tentatively rebooking for later in 2020. —Imbert

As major averages continue their comeback, strong market internals are signaling the bounce could have legs. More than 490 stocks in the S&P 500 were higher shortly after the open. On the NYSE, advancers outnumbered decliners by nearly 11 to one. —Melloy

A handful of big technology companies led the market comeback on Tuesday, with Amazon, Microsoft and Alphabet all rising more than 2% in morning trading. Apple jumped more than 3%. Amazon also hit a new all-time high, the first major company to reclaim its record after the coronavirus-triggered sell-off. The tech-heavy Nasdaq Composite climbed 2.6%, slightly outperforming the S&P 500. —Li

The Dow Jones Industrial Average was led higher by a 3.9% gain in Johnson & Johnson. The drugmaker was the biggest winner in the Dow in early trading on Tuesday. Johnson & Johnson announced earlier it was increasing its dividend. — Fitzgerald 

Stocks opened in the green on Tuesday as investors digested the first wave of corporate earnings. The Dow Jones Industrial Average rose 415 points, or 1.75% after the opening bell. The S&P 500 and Nasdaq gained 1.7% and 1.9%, respectively. — Fitzgerald 

President Donald Trump said in a press conference Monday that the administration was close to completing a plan to reopen the economy after “clear evidence” that mitigation to combat the coronavirus is working. “Over the weekend, the number of daily new infections remained flat, nationwide flat,” Trump said. “We want to be very, very safe. At the same time, we’ve got to get our country open.” Trump said he would give governors guidance within days about relaxing social-distancing practices, adding he hopes to reopen the country “ahead of schedule.” – Li

Stocks in the beaten down retail and apparel sector were making big strides in premarket trading as futures pointed to a strong start for the market on Tuesday. Gap shares rose 6.1%, while Macy’s gained 3.1% and Kohl’s jumped 4.2%. All three stocks are down more than 50% year-to-date. — Pound

Oil prices came under pressure on Tuesday as demand concerns continue to weigh. West Texas Intermediate crude, the U.S. benchmark, was down $1.06, or 4.7%, to trade at $21.38 per barrel. On Monday WTI fell 1.5%. International benchmark Brent crude traded 52 cents lower at $31.12 per barrel. The dip came even as OPEC and its oil-producing allies on Sunday announced that beginning May 1 it would cut production by 9.7 million barrels per day – the largest coordinated supply cut in history. Still, investors fear it won’t be enough to counteract the unprecedented demand loss caused by the coronavirus pandemic. – Stevens

CNBC’s Jim Cramer said on Monday’s “Mad Money” that he is growing increasingly optimistic about the coronavirus crisis. He said that the moves by the Federal Reserve and Congress to support the economy and the possibility of contact-tracing from private companies should help the country recover more quickly. “The worst case scenario’s been taken off the table, and if Apple and Google can do contact tracing that we all embrace … while we continue to roll out more testing, the economy could reopen a lot sooner than we thought even, say, three weeks ago,” Cramer said. — Clifford, Pound

Shares of cruise lines — one of the hardest hit industries from the coronavirus shutdown — rose in premarket trading on Tuesday as the virus outlook appeared to be improving in the U.S. Shares of Norwegian Cruise Line jumped more than 10% in extended trading. Carnival Corp. and Royal Caribbean both rose more than 8%. — Fitzgerald 

Johnson & Johnson stock rallied 3.5% in premarket trading after the drugmaker announced in its first-quarter earnings report that it’s raising its dividend. J&J raised its quarterly dividend from 95 cents a share to $1.01, a 6.3% increase, even as it cut its full-year earnings guidance due to the coronavirus outbreak. “The dividend this morning is a real good sign of the strength of the company. We’re in great financial position,” Chief Financial Officer Joseph Wolk told CNBC. The company cut its 2020 adjusted profit forecast to between $7.50 and $7.90 a share. — Franck

The global economic hit likely will be rate four times worse than the financial crisis and the U.S. will see its highest unemployment rate since World War II, according to a Goldman Sachs forecast. With most of the world’s developing economies on a near total shutdown to try to stop the coronavirus spread, Goldman sees a second quarter GDP decline of 11% from a year ago and 35% from the previous quarter on an annualized basis. In the U.S., the headline unemployment rate should hit 15% “and even this understates the severity of the situation” as many workers will be sidelined and not looking for jobs amid an anticipated reopening of the economy. That will accompany a GDP decline in the U.S. of 11% from a year ago and 34% on a quarterly basis, both numbers also considerably worse than anything seen during the financial crisis in 2008. — Cox

JPMorgan is building its credit reserves in anticipation that people might not be able to pay their bills, especially for credit cards. The bank’s first quarter earnings statement showed its credit reserves increased by $6.8 billion from the prior year, 56% of which was set aside for its consumer card division. “In the first quarter, the underlying results of the company were extremely good, however given the likelihood of a fairly severe recession, it was necessary to build credit reserves of $6.8B, resulting in total credit costs of $8.3B for the quarter,” CEO Jamie Dimon said in the earnings release. Of the $6.8 billion, more than half — or $3.8 billion — is earmarked for the bank’s Card division. In total $4.4 billion is allocated for consumer finance, with the remaining $2.4 billion for the bank’s wholesale business. – Stevens

Wells Fargo reported an 89% drop for its first-quarter profits as the bank set aside billions in credit provisions amid the coronavirus outbreak. Net income for the company dropped 89% to $653 million for the quarter. On a per-share basis, Wells posted earnings of 1 cent. “Our results were impacted by a $3.1 billion reserve build, which reflected the expected impact these unprecedented times could have on our customers,” said CFO John Shrewsberry in a statement. Still, the stock rose more than 1% in the premarket as net interest income came in above expectations. —Imbert

JPMorgan posted first-quarter profit well below analysts’ expectations, although the bank’s revenue held up amid the coronavirus pandemic. The bank on Tuesday posted quarterly per share earnings of 78 cents, missing analysts’ $1.84 estimate. The earnings drop was caused by a massive $6.8 billion addition to the bank’s credit reserves. The move signals that management expects a surge in defaults across the company’s lending businesses, from credit cards in its consumer division to energy, real estate and retail sector loans in its commercial operations. Profit of $2.87 billion plunged 69% from a year earlier, driven mostly by the provisions, while revenue proved to be more resilient, slipping 3% from a year earlier to $29.07 billion. JPMorgan’s trading division posted a 32% increase in revenue to a record $7.2 billion. – Hugh Son

The global economy will this year likely suffer the worst economic pullback since the Great Depression, the International Monetary Fund said Tuesday, as governments worldwide grapple with the Covid-19 pandemic. The Washington-based organization now expects the global economy to contract by 3% in 2020. By contrast, in January it had forecast a global GDP (gross domestic product) expansion of 3.3% for this year. “It is very likely that this year the global economy will experience its worst recession since the Great Depression, surpassing that seen during the global financial crisis a decade ago,” Gita Gopinath, the IMF’s chief economist, said in the latest World Economic Outlook report. — Amaro

Top industrials analyst Stephen Tusa wrote on Tuesday that General Electric‘s stock still looks expensive even to traditional value investors looking for a bargain deal. J.P. Morgan’s Tusa argued that while a chart may reveal a steep 41% slide in GE stock over the last three months, the equity isn’t cheap if you consider that free cash flow is down more than 100% and debt levels have increased. “’20/’21 may ultimately be the period of the most significant underperformance based on expectations at the end of ’18 versus what they are now, and even what will ultimately play out versus where they were as recently as March 4, 2020,” he wrote. “For such a poor performing stock, [which] GE has historically been, and remains, the most expensive value trap we’ve seen.” — Franck

Shares of the television streaming platform soared nearly 15% in premarket trading on Tuesday after the company said its first-quarter streaming hours to be 13.2 billion, a 49% increase year-over-year. Roku said it expects Q1 revenue to be slightly higher than expected in its prior outlook, and still expects strong growth in active accounts and streaming hours as consumers are home amid shelter-in-place orders meant to slow the coronavirus pandemic. Roku also withdrew its full-year guidance given uncertainty about how the pandemic will play out. — Fitzgerald, Graham

Shares of the electric automaker rose more than 7% in premarket trading on Tuesday following an upgrade to neutral from  underperform at Credit Suisse. The firm said Tesla’s competitive advantage in the electric vehicle world has increased as the coronavirus disruption forces legacy automakers to make tough decisions about product investment. “It competitively has more edge in the transition to EV as coronavirus disruption will make it more difficult for legacy automakers to balance the long-term shift to EV in the face of near-term cycle disruption,” Credit Suisse research analyst Dan Levy told clients. Credit Suisse hiked its price target to $580 per share from $450 per share, implying Tesla’s stock will fall 12% from its current level of $650.95 per share.  — Fitzgerald 

WHO spokeswoman Dr. Margaret Harris said at a briefing in Geneva that 90% of new cases of the coronavirus are coming from the United States and Europe and “we are certainly not seeing the peak yet.” Spain, one of the hardest-hit countries reported its lowest increase in, new cases since March 18, though its death toll rose to 567 from 517 the previous day. There have been more than 1.9 million confirmed cases around the world and at least 120,449 deaths, according to Johns Hopkins University. The U.S. has seen more than 580,000 cases and over 23,000 deaths. — Pound, Reuters

U.S. stock futures rose amid growing optimism that the coronavirus outbreak is starting to peak. Dow Jones Industrial Average futures were up more than 300 points. S&P 500 and Nasdaq 100 futures also traded higher. President Donald Trump said in a press conference Monday that growth in new coronavirus infections stabilized, providing “clear evidence” that mitigation is working in the country. New York Gov. Andrew Cuomo struck an optimistic tone about the outbreak in New York state, the epicenter of the pandemic in the United States. Investors also turned to corporate earnings as JPMorgan Chase released its first-quarter results. 

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— with reporting from Tom Franck, Pippa Stevens, John Melloy, Yun Li, Hugh Son, Michael Bloom, Michael Sheetz.