McDonald's Plunges After CDC Links E. Coli Outbreak To Quarter Pounders

McDonald's stock plunged after the Centers for Disease Control and Prevention linked the fast-food chain's Quarter Pounder burgers to an E. coli outbreak.

The CDC said the outbreak has hit 10 states, with 10 hospitalizations and one death. "Most" of the 49 people reported falling sick said they ate a McDonald's Quarter Pounder, the CDC said.

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The FDA's website said, "Investigators are working to determine if the slivered onions or beef patties on Quarter Pounder burgers are the likely source of contamination. McDonald's has temporarily stopped using Quarter Pounder slivered onions and beef patties in affected states. Diced onions and other types of beef patties used at McDonald's have not been implicated in this outbreak."

McDonald's stock tumbled 6.3% Wednesday morning, though off Tuesday night's worst levels. Shares of the Dow Jones giant had closed slightly extended from a buy zone, but could test the 292.21 buy point.

Starting in late 2015, Chipotle Mexican Grill (CMG) faced a series of serious foodborne illness outbreaks, triggering a huge multiyear sell-off in CMG stock. Chipotle shares fell 1.5% Wednesday.

Separately, Starbucks (SBUX) reported weaker-than-expected preliminary results for its fiscal fourth quarter. Same-store sales fell vs. a year earlier for a third straight quarter, led by a 10% U.S. drop. New CEO Brian Niccol, brought over from running Chipotle to revive Starbucks, said the coffee chain must "fundamentally change" but said "our problems are fixable."

Starbucks stock fell 2.4%, just below its 50-day line. SBUX stock edged up 0.4% to 96.82 on Tuesday, working on a 99.51 flat-base buy point.

Please follow Ed Carson on Threads at @edcarson1971 and X/Twitter at @IBD_ECarson for stock market updates and more.

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