It was another crazy day of trading.
Last night futures went limit down AGAIN (down 5.0% over night) after Democrats and Republicans failed to agree on a stimulus bill.
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But this morning before markets opened the Fed stepped in, by raising it’s cap for purchasing treasury and mortgage backed securities. The cap was initially set at $500 billion, then $700, and now…”the amounts needed!”
But it wasn’t enough.
After the E-Mini S&P experienced a 9% swing (down 5% to up almost 4%) in pre-market trading, the major indices slide into the open.
Stocks continued to slide after the opening bell, and the major indices were down around 4.0% heading into lunch.
With traders looking at Washington to pass a stimulus deal, trading was choppy.
But after lawmakers failed to pass a stimulus deal for the 2nd day straight, stocks dropped again. The concern now is that a bill might not be passed until Friday.
While the S&P and DOW dropped 3.0%, the NASDAQ was stronger, down just 0.4%.
Here’s where the major indices ended the day:
- The S&P finished with a 2.9% loss. Down 68 points, the S&P ended at 2,237.
- The DOW ended down 3.0%. Dropping 582 points the DOW closed at 18,592.
- The NASDAQ was down 0.4%. With a 28 point loss, the NASDAQ finished at 6,853.
Crude Oil (CL) found support around the $22 mark and finished higher. With a a 3.7% gain, Crude Oil finished at $23.46 a barrel.
Boeing (BA) was a big winner today, up 11.2% after Goldman Sachs said Boeing is a buy.
Gold (GC) was up big after today’s Fed stimulus. Gold finished the day with a 5.5% gain at 1566.8 an ounce.
There’s still an overwhelming amount of uncertainty in the markets.
But one thing that is for certain…the economy in the 2nd quarter is screwed because of COVID-19.
Goldman Sachs economists expect the economy to contract by 24%. And a Morgan Stanley economist is calling for a 30% contraction.