April 1, 2020
Ugly Beginning to an Uglier Ending
Q2 Starts Down After Q1 Ends Worst Ever
The first quarter of 2020 was the worst quarter for the U.S. stock market in history.
Right like Q1 ended, Q2 began. One of the most alarming traits of the stock market in the first quarter – with respect to the Dow – was the frequency of 1,000 point daily moves. They were both up and down, though mostly down. That’s basically how today, the first day of the second quarter, went. The Dow closed with a small uptick going into closing bell to avoid dropping 1,000 points. Here’s today’s scorecard:
I stated this in the last Market Update March 27, “So, today we had another – what has become normal – near 1,000 point loss for the Dow.” Today’s near-1,000 point fall broke stride from a weeklong rising trend for the U.S. stock market. The major indexes went back to where they were six sessions ago. Small caps were hurt most in today’s retracement, as the table above shows. Every S&P sector fell today, with dividend-heavy utilities and real estate falling the most. Last night’s futures market indicators tipped off today’s sell-off, after President Trump offered a dire outlook over the coming weeks for the U.S. coronavirus outbreak. He said the country is facing a “very, very painful two weeks.”
The coronavirus outbreak continues to spread rapidly in the U.S., with confirmed cases topping 211,000, along with 4,713 deaths by today, according to Worldometers data tracker. New York continues to be the epicenter of the outbreak in the U.S., with more than 83,000 total cases, or about 40% of the country’s total. Global Covid-19 cases topped 927,000 with over 46,000 deaths.
Here’s some wise words from Mr. Peter Lynch:
“You get recessions, you have stock market declines. If you don’t understand that’s going to happen, then you’re not ready, you won’t do well in the markets.”
Hope this is helpful.
Thank you for your continued trust and confidence. I remain vigilant as I manage and oversee your investment account.
John