US Stock Markets Ended Feb. 28, 2020

Bob Carey
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US Stock Markets Ended Feb. 28, 2020

Posted Under: Weekly Market Commentary

The S&P 500 Index entered correction territory last week declining 11.44%, its worst performance since early October 2008. The index has delivered seven consecutive negative trading days, eliminating the 2020 gains and is down 8.27% YTD. Equity markets reflected anxiousness over the spread of the coronavirus as the World Health Organization increased its global risk level. The virus has contributed to uncertainty in global financial markets as companies continue to evaluate the virus's impact on their operations and supply chains, causing some investors to adjust their expectations downward for 2020. Equity markets showed no place to hide as all economic sectors closed down more than 10% with the exception of communication services at -9.45%. Crude oil closed at $44.76 per barrel on Friday, declining 16.15% for the week as fears of a global slowdown hurt the energy sector most, returning -15.37%. The University of Michigan Consumer Sentiment Index revealed high U.S. consumer optimism for February, though last week's slide could affect the confidence reading in March. U.S. initial jobless claims of 219K were higher than the consensus estimate of 212K and the previous week's claims of 210K. Only two stocks in the S&P 500 Index showed positive returns for the week. Regeneron Pharmaceuticals Inc., a biopharmaceutical company, was the best performing stock in the index, up 10.27%. The company and the U.S. Department of Health and Human Services are engaged in developing a treatment for the coronavirus. Airline and cruise line companies reflected the negative impact the virus is beginning to have on current and future travel. American Airlines Group Inc. showed the worst performance for the week with a -31.52% return. Other major airlines and cruise lines that declined over 20% include Alaska Air Group Inc., United Airlines Holdings Inc., Delta Air Lines Inc., Royal Caribbean Cruises Ltd., and Norwegian Cruise Line Holdings Ltd, with Carnival Corp losing 19.74%. This week, equity markets could remain volatile as investors process last week's decline.

Posted on Monday, March 2, 2020 @ 8:12 AM • Post Link	Share:
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These posts were prepared by First Trust Advisors L.P., and reflect the current opinion of the authors. They are based upon sources and data believed to be accurate and reliable. Opinions and forward looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security.

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