Day Traders Diary

4/3/20

The major averages pulled back, but finished off their lows to end another wild week. The Dow Jones Industrial Average slid 360 points, or 1.7%, to 21,052. The S&P 500 dropped 1.5% to 2,488. The Nasdaq Composite also pulled back 1.5% to close at 7,373. American Express, UnitedHealth and IBM fell more than 3% each to lead the Dow lower. Some of those losses were offset by Walmart, which turned around to close 0.7% higher after a report said the company's sales have jumped 20% in the past month.

Wall Street still posted its third weekly decline in four. The Dow lost 2.7% this week while the S&P 500 fell 2.1%. The Nasdaq ended the week down 1.7%. Both the Dow and S&P 500 remain more than 26% below their respective all-time highs set in February as jitters over the spread of COVID-19 foster volatile trading on Wall Street.

The weakness in the markets this morning started with the U.S. payrolls falling by 701,000 in March, marking the worst jobs report since 2009, while the unemployment rate jumped to 4.4%. However, the report failed to capture the full extent of the ongoing economic blow from the coronavirus outbreak. On Thursday, the Labor Department said jobless claims jumped by a record of 6.6 million for the week of March 27.

Then during the lunch hour, New York Gov. Andrew Cuomo gave his daily update with 562 new deaths in the last 24 hours to more than 2,900 for the biggest increase to date. Cuomo added the curve of confirmed cases "continues to go up," noting there are now over 100,000 cases in New York state.

There have been more than 261,000 confirmed infections in the United States and more than 6,600 deaths from COVID-19, according to data from Johns Hopkins University. Globally, more than 1 million cases have been confirmed.

Ten out of eleven sectors ended in the red with six sectors logging wider losses than the broader market. Utilities (-3.6%), materials (-2.3%), and financials (-2.2%) were at the forefront of the selling while real estate (-0.8%) and consumer staples (+0.5%) outperformed.

For the week, the utilities sector surrendered 7.1%, finishing behind the remaining ten sectors.

Crude oil was able to build on yesterday's advance, climbing $3.16, or 12.6%, to $28.34/bbl. The energy component gained $6.69 or 30.9% for the week while the energy sector (-1.3%) climbed 5.4% since last Friday.

Longer-dated Treasuries finished near their best levels of the day, sending the 10-yr yield lower by four basis points to 0.59%. The U.S. Dollar Index climbed 0.4% to 100.61, gaining 2.2% for the week.