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.

Indiana Coronavirus Cases

Data is updated nightly.

Cases: 697533

Reported Deaths: 13138
CountyCasesDeaths
Marion951321706
Lake50779930
Allen38511669
Hamilton33981404
St. Joseph33279535
Elkhart26810431
Vanderburgh21931393
Tippecanoe21440212
Johnson17325371
Porter17012297
Hendricks16631308
Clark12592190
Madison12223335
Vigo12089243
Monroe11237166
LaPorte10601204
Delaware10241182
Howard9555211
Kosciusko8999112
Hancock7842137
Bartholomew7797152
Warrick7657155
Floyd7501175
Wayne6846196
Grant6724167
Boone647399
Morgan6335137
Dubois6052117
Marshall5709108
Cass5657102
Dearborn564674
Henry5545100
Noble532583
Jackson489469
Shelby474095
Lawrence4305118
Gibson424988
Harrison424870
Montgomery414486
Clinton413153
DeKalb402583
Huntington371880
Whitley371039
Miami369565
Knox363589
Steuben358457
Putnam350560
Wabash344677
Jasper341646
Adams336652
Ripley332368
Jefferson306479
White305954
Daviess287999
Wells283580
Decatur278092
Fayette276562
Greene268685
Posey267333
Scott258553
Clay250744
LaGrange249970
Randolph233379
Washington228429
Spencer226731
Jennings223947
Fountain207245
Sullivan207041
Starke199352
Owen190856
Fulton188939
Jay184829
Carroll184520
Perry178536
Orange175552
Rush169324
Vermillion165343
Franklin164435
Tipton160343
Parke143416
Blackford131730
Pike129634
Pulaski112245
Newton102334
Brown98840
Crawford96814
Benton94513
Martin81915
Warren78315
Switzerland7678
Union69410
Ohio55311
Unassigned0405

Ohio Coronavirus Cases

Data is updated nightly.

Cases: 1037600

Reported Deaths: 18827
CountyCasesDeaths
Franklin1203461345
Cuyahoga1048492040
Hamilton774221164
Montgomery49484984
Summit44494904
Lucas39105757
Butler37437566
Stark31094890
Lorain23775467
Warren23688291
Mahoning20622581
Lake19698360
Clermont19305226
Delaware17783130
Licking15970205
Fairfield15493195
Trumbull15377458
Medina14662255
Greene14484233
Clark13433287
Wood12547182
Portage12144193
Allen11216229
Richland10899197
Miami10455211
Muskingum8639127
Columbiana8478225
Wayne8451209
Pickaway8388120
Tuscarawas8311239
Marion8297135
Erie7415153
Ross6636145
Hancock6595123
Geauga6449146
Ashtabula6355163
Scioto625299
Belmont5518158
Union550847
Lawrence5435102
Huron5229112
Darke5225121
Jefferson5210147
Sandusky5087118
Seneca5048118
Washington5029107
Athens493654
Auglaize470484
Mercer467884
Shelby453289
Knox4332108
Putnam417298
Madison416157
Ashland408986
Fulton402165
Defiance395096
Brown383855
Crawford3819100
Logan369676
Preble367995
Clinton356859
Ottawa351978
Highland344858
Williams317574
Champaign317055
Jackson304451
Guernsey303348
Perry286449
Fayette276348
Morrow272639
Henry261266
Hardin261063
Coshocton255957
Holmes251499
Van Wert237462
Gallia232146
Pike230931
Adams226151
Wyandot224153
Hocking207057
Carroll187746
Paulding167538
Meigs140838
Noble131737
Monroe128441
Morgan105722
Harrison104836
Vinton80913
Unassigned01
Fort Wayne
Cloudy
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Hi: 56° Lo: 46°
Feels Like: 43°
Angola
Cloudy
48° wxIcon
Hi: 54° Lo: 45°
Feels Like: 45°
Huntington
Cloudy
47° wxIcon
Hi: 54° Lo: 46°
Feels Like: 44°
Fort Wayne
Cloudy
48° wxIcon
Hi: 53° Lo: 46°
Feels Like: 43°
Lima
Cloudy
51° wxIcon
Hi: 53° Lo: 46°
Feels Like: 51°
Rain showers continue Saturday evening, as will a few thunderstorms. Overnight, rain will taper off a little as temperatures drop into the mid 40s. On Sunday, rain chances return in late morning and last much of the day. Temperatures max out in the mid 50s and winds will be brisk at times.
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