| | | Stocks extend losses after Senate fails to advance stimulus bill
23-Mar-20 16:15 ET
Dow -582.05 at 18591.99, Nasdaq -18.84 at 6860.03, S&P -67.52 at 2237.40
[BRIEFING.COM] The S&P 500 fell 2.9% on Monday in another volatile session, as disappointment over the Senate's inability to advance its stimulus bill outweighed the unprecedented stimulus measures announced by the Fed. The Dow Jones Industrial Average declined 3.0%, the Russell 2000 declined 1.1%, and the Nasdaq Composite declined just 0.3%.
Selling was mostly broad-based with ten of the 11 S&P 500 sectors finishing lower, particularly the energy (-6.7%) and financials (-6.1%) sectors. The exceptions were the S&P 500 consumer discretionary sector (+0.4%) and Philadelphia Semiconductor Index (+3.4%).
Today's action started last night when futures hit limit down after the Senate failed to gather enough procedural votes for its stimulus bill. Losses were later trimmed on some cautious optimism that another vote for a revised plan would fare better today, but the real move came after the Fed's stimulus announcement sent futures into the green.
Briefly, the Fed lifted the $700 billion cap on its purchases of Treasury and agency mortgage-backed securities and said it will buy "in the amounts needed." In addition, the central bank established new credit facilities and said it will be buying investment-grade corporate bonds, municipal debt, and U.S.-listed exchange ETFs.
Despite the Fed's efforts to support the system and prevent confidence from eroding further, investors continued to sell into strength, leaving the S&P 500 down 4.9% at its low. The disappointing price action suggested that the market was signaling Washington to get its act together and approve a long-awaited stimulus plan for Americans and businesses.
The S&P 500 did battle back to just below its flat line heading into the second procedural vote in the afternoon, but the rebound effort was squandered after it failed again. Senate Majority Leader McConnell (R-KY) said that procedural delays could push another vote out to Friday, which is a long time for an impatient market.
In the meantime, confirmed cases of the coronavirus continued to surge while more states enacted stay-at-home orders to curb its spread. General Electric (GE 6.11, -0.41, -6.3%) was among the latest high-profile companies to announce temporary layoffs, specifically 10% of its aviation workforce, due to the virus sapping demand for its business.
Boeing (BA 105.62, +10.61) shares rose 11.2% in a reprieve from the heavy selling endured over the past month. Today, the company suspended production operations at its Puget Sound area facilities for 14 days, suspended its dividend, and extended its pause of any share repurchasing until further notice.
U.S. Treasuries finished higher amid the continued weakness in equities and the latest actions from the Fed. The 2-yr yield fell eight basis points to 0.29%, and the 10-yr yield fell 17 basis points to 0.76%. The U.S. Dollar Index declined 0.3% to 102.48. WTI crude rose 3.8%, or $0.86, to $23.49/bbl.
Investors did not receive any notable economic data on Monday. Looking ahead, investors will receive New Home Sales for February on Tuesday.
- Nasdaq Composite: -23.5%
- S&P 500: -30.8%
- Dow Jones Industrial Average: -34.9%
- Russell 2000: -39.9%
Market Snapshot
| Dow | 18591.99 | -582.05 | (-3.04%) | | Nasdaq | 6860.03 | -18.84 | (-0.27%) | | SP 500 | 2237.40 | -67.52 | (-2.93%) | | 10-yr Note | +8/32 | 0.770 |
|
| | NYSE | Adv 665 | Dec 2263 | Vol 1.6 bln | | Nasdaq | Adv 1322 | Dec 1998 | Vol 4.3 bln |
Industry Watch
| Strong: Consumer Discretionary, Consumer Staples |
| | Weak: Financials, Real Estate, Utilities, Energy |
Moving the Market
-- Stocks extend rout after Senate fails to get enough votes to advance stimulus bill; timeline might be delayed to Friday
-- Fed announces extensive stimulus measures, including unlimited purchases of Treasury and agency MBS if needed
-- Broad-based selling
|
Stocks back near session lows, while crude futures gain
23-Mar-20 15:25 ET
Dow -831.91 at 18342.13, Nasdaq -123.20 at 6755.67, S&P -97.80 at 2207.12
[BRIEFING.COM] The S&P 500 is trading back near session lows with a 4.3% decline amid damped spirits following the failed vote in the Senate.
One last look at the S&P 500 sectors shows the energy (-7.2%) and real estate (-7.3%) sectors taking it on the chin, while the consumer discretionary sector (-1.0%) is down the least. The latter can credit Amazon (AMZN 1877.85, +30.24, +1.7%) for its current positioning.
WTI crude futures settled up $0.86 (+3.8%) to $23.49/bbl. |
|
