Stocks post worst week since the financial crisis

US stocks tumbled once again as coronavirus fears continue to mount. As the novel coronavirus continues to spread around the world, countries are scrambling to respond. Economists and investors are concerned about the outbreak's impact on economic growth and corporate earnings. CNN's Alison Kosik reports.

Posted: Feb 29, 2020 6:51 PM
Updated: Feb 29, 2020 6:51 PM

It was a terrible week for the US stock market. The three major stock indexes posted their worst weekly percentage drops since the financial crisis, as coronavirus fears mount.

Stocks spent nearly all day in negative territory with the exception of a brief jump higher in the Nasdaq Composite. Market expectations that the Federal Reserve will step in to stop the selloff and boost the economy have shot through the roof after the dramatic week.

Dow

  • The Dow closed 357 points, or 1.4%, lower, on its seventh day in the red.
  • At its worst, the index was down nearly 1,086 points.
  • It dropped 3,583 points this week, including its worst one-day point drop in history on Thursday. On a percentage basis, Thursday's 4.4% slump was the worst performance since February 2018.
  • It was its worst week since October 2008, as it fell 12.4%.

S&P 500

  • The S&P 500, the broadest measure of the stock market, fell 0.8%.
  • It dropped 11.5% this week, its worst weekly percentage drop since October 2008.
  • The selloff has shaved $3.2 trillion off the S&P this week. It has dropped $3.6 trillion from its February 19 high.

Nasdaq Composite

  • The Nasdaq Composite ended flat.
  • The index fell 10.5% for the week.

The lower close shows that investors are willing to hold their positions over the weekend, which signals that the coronavirus -linked selloff might continue. Coronavirus fears have also clobbered the energy market as investors brace for a collapse in demand for everything from jet fuel to diesel and motor gasoline. Decreased factory activity in China, where businesses shut to contain the outbreak, is also weighing on prices.

Crude oil, which is often viewed as a real-time barometer of economic growth, has plunged deeper into a bear market. US oil plunged 4.9% on Friday to $44.76 a barrel. Crude hasn't closed below $46 since December 2018. The commodity is on track for its sharpest weekly decline since 2011.

Gold, which is traditionally a safe haven during times of market trouble, sold off too. Market participants attribute the drop to investors pulling cash out of their gold investments to counter their losing stock investments. Gold futures settled 4.6% down at $1,564.10 an ounce, recording its worst one-day percentage loss since November 2016.

Treasury yields slipped further and hit new record lows on Friday as investors piled into the safe haven government bonds. Bond yields and prices move opposite to each other. The 10-year bond yield dropped below 1.15%.

Fed to the rescue

The Federal Reserve is in focus on Friday, after expectations for an interest rate cut at the March 18 meeting spiked to 100%, according to the CME FedWatch Tool. Expectations for a half-percentage point cut have shot higher over night. They were at 52% after the Friday close, having spiked over 90% in the afternoon. Expectations had been at zero on Thursday.

Even though the next Fed meeting is three weeks away, the central bank could meet earlier for an emergency rate cut, said analysts at Bank of America Merrill Lynch Friday afternoon. The last emergency rate cut took place in 2008.

BofA also expects a half percentage point cut.

But the speculation about a rate cut also implies that the economy could be worse off than widely believed.

"If the Fed need to intervene, how bad is the situation?" said David Madden, market analyst at CMC Markets.

That said, various Fed officials have so far said rate cuts are not yet necessary.

Fed Chairman Jerome Powell called the fundamentals of the US economy strong in a statement Friday afternoon. He said the central bank was closely monitoring the outbreak and its economic implications, and will "act as appropriate to support the economy."

St. Louis Fed President James Bullard in a speech Friday that "further policy rate cuts are a possibility if a global pandemic actually develops with health effects approaching the scale of ordinary influenza, but this is not the baseline case at this time."

The University of Michigan, which publishes the monthly consumer sentiment survey, warned on Friday that "domestic spread of the virus could have a significant impact on consumer spending."

While the final read of February consumer sentiment beat expectations and rose to the highest level since March 2018, an increasing number of survey participants mentions the virus outbreak in the last days of February. Consumers are the backbone of the US economy and a drop in spending could hurt economic growth.

As the novel coronavirus continues to spread around the world, countries are scrambling to respond. Economists and investors are concerned about the outbreak's impact on economic growth and corporate earnings. Various American multinational companies, including Apple and Microsoft, have warned that they won't meet their earnings guidance because of disruptions from the virus.

West Lafayette
Overcast
65° wxIcon
Hi: 68° Lo: 45°
Feels Like: 65°
Kokomo
Overcast
60° wxIcon
Hi: 64° Lo: 42°
Feels Like: 60°
Rensselaer
Broken Clouds
64° wxIcon
Hi: 66° Lo: 42°
Feels Like: 64°
Fowler
Broken Clouds
64° wxIcon
Hi: 64° Lo: 43°
Feels Like: 64°
Williamsport
Overcast
66° wxIcon
Hi: 66° Lo: 44°
Feels Like: 66°
Crawfordsville
Broken Clouds
67° wxIcon
Hi: 67° Lo: 43°
Feels Like: 67°
Frankfort
Overcast
65° wxIcon
Hi: 66° Lo: 42°
Feels Like: 65°
Delphi
Broken Clouds
65° wxIcon
Hi: 67° Lo: 43°
Feels Like: 65°
Monticello
Broken Clouds
65° wxIcon
Hi: 63° Lo: 44°
Feels Like: 65°
Logansport
Scattered Clouds
63° wxIcon
Hi: 64° Lo: 41°
Feels Like: 63°
Some more scattered rain with windy & cooler conditions.
WLFI Radar
WLFI Temps
WLFI Planner

Indiana Coronavirus Cases

Data is updated nightly.

Confirmed Cases: 119066

Reported Deaths: 3612
CountyConfirmedDeaths
Marion21563768
Lake10745324
Elkhart6734112
St. Joseph6679115
Allen6364205
Hamilton4965109
Vanderburgh384231
Hendricks2779124
Monroe267137
Tippecanoe259013
Johnson2362125
Clark226757
Porter222447
Delaware201162
Cass19589
Vigo187928
Madison171475
LaPorte151941
Warrick140743
Floyd140464
Howard133964
Kosciusko127117
Bartholomew119357
Marshall102124
Dubois100919
Boone99746
Grant96636
Hancock94843
Noble92932
Henry82226
Jackson77610
Wayne77314
Morgan73940
Shelby68329
Daviess68129
Dearborn67928
LaGrange64711
Clinton63414
Harrison59824
Putnam59011
Gibson5455
Knox5379
Lawrence51829
Montgomery51321
DeKalb49111
White48814
Decatur46139
Miami4394
Greene42936
Fayette42314
Jasper4032
Steuben3977
Scott39311
Posey3541
Sullivan33812
Jennings31712
Franklin31525
Clay3105
Ripley3108
Orange28724
Whitley2876
Carroll28013
Adams2773
Wabash2758
Starke2737
Washington2702
Wells2694
Spencer2683
Jefferson2523
Huntington2503
Fulton2462
Tipton22922
Randolph2238
Perry22213
Jay1920
Newton17411
Owen1711
Martin1690
Pike1691
Rush1584
Vermillion1320
Fountain1302
Blackford1223
Pulaski1141
Crawford1100
Parke1072
Brown1033
Benton860
Ohio797
Union790
Switzerland690
Warren411
Unassigned0227

COVID-19 Important links and resources

As the spread of COVID-19, or as it's more commonly known as the coronavirus continues, this page will serve as your one-stop for the resources you need to stay informed and to keep you and your family safe. CLICK HERE

Closings related to the prevention of the COVID-19 can be found on our Closings page.

Community Events