Stock Market Update Wednesday, March 11th, 2020

Stocks were hammered today, and the longest Bull Market in history is officially over (at least for the DOW).

It’s hard to believe, but there were some positive developments overnight.

The Bank of England (BOE) announced an emergency 50-basis point rate cut. And the Fed increased liquidity in the overnight repo limits (money the Fed provides for overnight bank lending).


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But the Central Bank stimulus measures did little to calm the markets.

Stocks were down at the open and continued to slide.

Then selling accelerated after the World Health Organization (WHO) declared COVID-19 (coronavirus) a global pandemic. There were also reports that a Congressional Dr. expects that 70-150 million people in the U.S. will be infected with the virus…right now there are 121,000 confirmed cases across the globe.

With losses of 4.6%+, the major indices gave up all of yesterday’s gains.

With stocks getting hammered across the board, the DOW is now in a bear market (down 20% from recent highs) and the bull market that began in 2009 is now over.

Here’s where the major indices ended the day:

  • The S&P finished with a 4.9% loss. Down 141 points, the S&P ended at 2,741.
  • The DOW ended lower by 5.9%. Dropping 1,465 points the DOW closed at 23,553.
  • The NASDAQ was down 4.6%. With a 379 point loss, the NASDAQ finished at 7,952.

Crude Oil (CL) spent the day in negative territory and ended with a loss. Down 3.6%, Crude Oil finished the day at $33.11 a barrel. Today’s Crude Oil Inventories showed that U.S. stockpiles.

Yesterday, stimulus news from Washington helped drive markets higher. But in reality stimulus is easier said that done.

President Trump threw out the idea of 0% payroll taxes.

But both Democrats and Republicans are against the idea, arguing that there are better ways to support the economy and helped those likely to get hardest hit by COVID-19 (hourly workers and small businesses).

Boeing (BA) was today’s biggest loser in the DOW, down 18.1% drop after the company announced a hiring freeze.

But the strangest thing today was that stocks were down 5% and there was no “flight to safety.”

Typically during big drops and economic uncertainty stocks will sell-off and Gold (GC) will rally. But today Gold was down 1.1%. And 10-Year Notes (ZN) were also lower, down 0.2%.

Where do we go from here?

The NASDAQ and S&P will be next to enter bear market territory (now down approximately 19% from record highs). And it could get worse before it gets better.

According to a Goldman Sachs analyst, the average bear market sees a 33% drop based on data going back to World War II. And right now we’re hovering around the 19-20% mark.

But as always…trade what you SEE, not what you THINK. 😉

Here is the economic calendar for the week:

Real Time Economic Calendar provided by Investing.com.

Source: RockwellTrading by Markus Heitkoetter | Original Link

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