AAPL Apple Inc

By Paul Vigna 

The stock market set records again this week, but investors faced new concerns as well. Apple Inc. warned its sales would take a hit from the coronavirus epidemic, and it is becoming clearer that China's gross domestic product will suffer, too. It is shaping up to be a down week for Wall Street.

Here is a look at some of the biggest winners -- and losers -- in the market.

WINNER: E*Trade

Investors who wanted to tap the stock market moneymaking machine but couldn't afford to pay for one of those fancy, white-shoe Wall Street firms could turn to a discount broker like E*Trade Financial Corp. Now, Wall Street is turning to E*Trade, too.

Morgan Stanley on Thursday agreed to acquire E*Trade for $13 billion in stock, in what would be the largest deal by one of the big U.S. banks since the financial crisis in 2008. Shares of E*Trade surged as much as 27% on the news, their largest one-day gain since 2009.

For E*Trade, the attraction was obvious. Its main rivals, Charles Schwab Corp. and TD Ameritrade Holding Corp., agreed to a merger last fall. E*Trade was the odd man out. There were doubts about its ability to go it alone. The company didn't want to wait around to see what happened.

Morgan Stanley didn't blithely decide to dilute its shareholders by $13 billion, though. The deal will make the other House of Morgan the biggest wealth manager in the world, with $3 trillion in assets under management. Morgan Stanley is adhering to one of the best-known axioms in corporate America: When you can't create growth on your own, you have to go out and buy it.

This deal is just the latest sign that, for all the stock-market records, Wall Street isn't a growth industry these days. The deal will ramp up pressure on some of Morgan Stanley's competitors like Goldman Sachs Group Inc.

Honorable Mentions: Members Exchange, a startup looking to launch a rival to the New York Stock Exchange and Nasdaq Inc., said it completed a funding round that included investments from Wall Street heavy hitters Goldman Sachs and JPMorgan Chase & Co. It is a sign that some of the Big Board's big clients are also looking for ways to dilute the dominance of the incumbent exchanges.

Goldbugs: Gold futures rose above $1,600 an ounce, hitting their highest point in seven years, as some investors look for havens in expectation that the coronavirus outbreak will have a bigger economic impact than currently expected.

LOSER: Retailers

Every time you see one of those blue Amazon delivery trucks, it is another body blow to the bricks-and-mortar retailer. That was made clear this week after Walmart Inc., the world's largest retailer, posted sluggish holiday-sales numbers.

It isn't that Walmart lacks an online strategy. Its online holiday sales did indeed rise. But that couldn't offset the fact that fewer people are getting in their cars and doing their own shopping.

Meanwhile, Pier 1 Imports Inc. finally threw in the towel. And the wicker chairs. And the elephant-theme umbrella holders. The funky home-goods retailer filed for bankruptcy protection Monday, after years of trying to reinvent itself in a changing retail landscape. Under its new plan, it will sell off the company, either in whole or in parts.

Honorable Mention: Speaking of the lack of growth in the financial markets, 35,000 or so U.S. and European staffers at HSBC Holdings PLC are going to lose their jobs in the latest part of the big bank's retrenchment. Once upon a time, HSBC had ambitions to be a major global bank. Now it is narrowing its ambitions.

Next Week: Speaking of retailers, next week brings more earnings reports, and retailers are in the spotlight. Look for reports from Home Depot Inc. and Macy's Inc. (Tuesday), L Brands Inc. (Wednesday) and Beyond Meat Inc. (Thursday).

On the economic front, a clutch of reports will provide new insights into the health of the U.S. consumer and the economy. Look for new-home sales (Wednesday), the second report on fourth-quarter GDP (Thursday) and personal income and spending (Friday).

Write to Paul Vigna at paul.vigna@wsj.com

(END) Dow Jones Newswires

February 21, 2020 07:14 ET (12:14 GMT)

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