Dow Jones Tumbles 250 Points on Coronavirus Fears; Walgreens Beats on Revenue and Earnings; IBM Announces Cloud Deals

Confirmed cases of the coronavirus are rising across Europe and many U.S. states, raising fears that a winter wave of COVID-19 will force renewed stay-at-home and lockdown orders that cripple the economic recovery.

The recovery is already fragile and uneven: Initial claims for state unemployment benefits for the week ended Oct. 10 increased to 898,000, still far higher than pre-pandemic levels. The Dow Jones Industrial Average (DJINDICES:^DJI) was down around 0.9% at 10:50 a.m. EDT Thursday.

Shares of Walgreens Boots Alliance (NASDAQ:WBA) managed to gain despite the weak market after the drugstore chain reported solid quarterly results and guided for earnings growth next year. Meanwhile, a flurry of cloud deals from International Business Machines (NYSE:IBM) wasn’t enough to save the stock from riding the market lower.

Image source: Walgreens.

Walgreens delivers earnings beat

Sales were up and profits were down for drugstore chain Walgreens in its fiscal fourth quarter as key markets in the U.S. and the U.K. gradually improved. Revenue jumped 2.3% to $34.7 billion, beating analyst expectations by $390 million, while adjusted earnings per share dropped 28% to $1.02. While EPS was down, the adjusted figure was $0.06 ahead of the average analyst estimate.

Sales in the U.S. retail pharmacy business jumped 3.6% to $27.0 billion in the fourth quarter despite store closings. Prescriptions filled rose 1.6% as prescription volume trends improved, although the company says it lost some retail-prescription market share during the quarter.

The international retail pharmacy business didn’t fare as well, with sales slumping 14.9% to $2.3 billion. Comparable-store sales at Boots U.K. plunged 29.2% as customer visits to stores remained depressed, particularly in locations tied to train stations, airports, and busy shopping streets. One silver lining: E-commerce sales for Boots increased 155% during the quarter, partly offsetting the in-store weakness. E-commerce was also strong

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