Day Traders Diary

3/30/20

The major averages built on their strong rally from last week as the U.S. extended measures to contain the coronavirus outbreak. The Dow Jones Industrial Average rose 690 points, or 3.2%, to 22,327. The S&P 500 climbed 3.4% to 2,626 while the Nasdaq Composite closed 3.6% higher at 7,774. Tech stocks led the way with Microsoft jumping 7% while Alphabet and Amazon climbed 3.3% and 3.4%, respectively.

The Dow is now up 20% from its coronavirus sell-off low reached on Monday while the S&P 500 has risen more than 17% from those levels. The Nasdaq has bounced more than 13%.

President Donald Trump said at a news conference Sunday the national social distancing guidelines have been extended to April 30, adding the death rate from the virus would peak in two weeks. These measures, while they may cause a sharp economic disruption in the near term, are seen by some investors as preventing long-term damage to the economy.

Besides the tech stocks, healthcare performed well. Abbott Labs rose 6% on a new coronavirus test while Johnson & Johnson rose 8% as they work on a coronavirus vaccine.  

On the downside, shares of Boeing fell 6% eased back from last week's 70% surge, while airline stocks like American Airlines continue to suffer.

Separately, oil prices continued to falter with WTI crude settling down 6.6%, or $1.43, to $20.22/bbl, as the market remained plagued by excess supply and crippling demand. On a related note, President Trump said he would call Russian President Putin to discuss the price dispute with Saudi Arabia.

U.S. Treasuries, particularly longer-dated tenors, rose alongside equities to start the week. The 2-yr yield declined two basis points to 0.21%, and the 10-yr yield declined eight basis points to 0.67%. The U.S. Dollar Index rose 0.7% to 99.01.