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US Stock Markets Ended March 27, 2020
The S&P 500 Index returned 10.28% last week, its best performance since March 2009, leaving the index with a -20.96% YTD return. Equities rallied last week with all sectors posting positive returns on the expectation the coronavirus relief bill would be passed by the U.S. Congress. The $2 trillion bill intended to mitigate the accelerating damage to the economy was signed by President Trump on Friday. Uncertainties surrounding the virus have created havoc in human interaction and equity markets. Social distancing, work from home, and shelter in place orders throughout the country have slowed economic activity causing distress on businesses. The S&P 500 Index briefly traded below 2,200 last Monday, levels not seen since late 2016. The index declined 33.79% from the closing high a month ago on February 19 through this past Monday. Crude oil closed at $21.51 per barrel on Friday, declining 4.10% as demand continues to decline. Increasing consumer pessimism was reflected by an 11.9-point drop in the University of Michigan Consumer Sentiment Index's March reading, the largest one month decline since 2008. The speed of the economic decline was evident as consensus estimates of 1.7 million U.S. initial jobless claims were almost doubled by the actual claims of 3.28 million, eclipsing the previous week's claims of 281K. Commercial aircraft manufacturer The Boeing Company was the best performing stock in the index, up 70.51%. The stock jumped on expectations the stimulus bill would help keep its supply chains and airline customers in business who are struggling from the swift drop in air travel demand. While most equities were up for the week, some of the larger returns came from companies that have been under considerable market pressure such as cruise line companies Royal Caribbean Cruises Ltd. and Norwegian Cruise Line Holdings which returned 44.9% and 37.84% respectively. Airlines also climbed on the stimulus as Delta Air Lines Inc., American Airlines Group Inc., and United Airlines Holdings Inc. returned 38.41%, 35.26%, and 34.04% respectively. However, despite these impressive returns, these three airlines, two cruise lines, and The Boeing Company are all down over 49% since the market high on February 19. This week's jobless claims will be a focus of many seeking a clearer picture of our economic state.
Monday, March 30, 2020 @ 8:12 AM
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.