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Stock market loses 4% to start second quarter
01-Apr-20 16:15 ET
Dow -973.65 at 20943.57, Nasdaq -339.52 at 7359.93, S&P -114.09 at 2470.50

https://www.briefing.com/stock-market-update

[BRIEFING.COM] The stock market retreated more than 4% to start the second quarter on Wednesday, as President Trump warned that the next two weeks will be "very painful" in terms of coronavirus fatalities. The S&P 500 (-4.4%), Dow Jones Industrial Average (-4.4%), and Nasdaq Composite (-4.4%) each fell 4.4%. The Russell 2000 underperformed with a 7.1% decline.

The coronavirus task force on Tuesday estimated that deaths attributed to COVID-19 could total 100,000-240,000 in the U.S. with daily deaths projected to peak in two weeks. To help contain the outbreak, and hopefully bring these figures down, Florida, Nevada, and Pennsylvania joined the growing list of states to issue 'stay at home' orders for 30 days.

Original assumptions made by the medical community were based on the data coming out of China, which the U.S. intelligence community said underrepresented the real number of cases and deaths in the country, according to Bloomberg. The White House's projections, based on new data being released every day, had the market worried about the social and psychological effects on the economy.

In turn, no S&P 500 sector was spared in today's sell-off with ten sectors losing at least 3.0%, including 6.1% declines in the real estate and utilities sectors. The consumer staples sector performed relatively better with a 1.8% decline.

Economic data for March showed the manufacturing sector contract and private-sector hiring decline, as expected, due to the coronavirus. Many market participants, however, expect the data to worsen with Boston Fed President Rosengren expecting unemployment to increase "dramatically."

In the oil market, The Wall Street Journal reported that President Trump will meet with the CEOs of some of the largest U.S. oil companies on Friday to discuss how the government can help the industry. WTI crude spiked on the news before settling down 1.0%, or $0.20, to $20.32/bbl.

Separately, tucked behind the macro headlines was Xerox (XRX 17.60, -1.34, -7.1%) withdrawing its offer to acquire HP Inc (HPQ 14.84, -2.52, -14.5%), Marriott (MAR 69.15, -5.66, -7.6%) disclosing a data breach that affected 5.2 million customers, and Macy's (M 4.43, -0.48, -9.8%) being removed from the S&P 500.

U.S. Treasuries finished mixed with longer-dated Treasuries advancing in a safe-haven bid. The 2-yr yield increased two basis points to 0.22%, while the 10-yr yield declined six basis points to 0.64%. The U.S. Dollar Index rose 0.5% to 99.50.

Reviewing Wednesday's economic data:

The ISM Manufacturing Index for March registered a reading of 49.1% (Briefing.com consensus 43.3%), down from 50.1% in February. The dividing line between expansion and contraction is 50.0%.
The key takeaway for some will be that the number wasn't as bad as feared, but lost in that takeaway is the fact that the overall index was supported by a sizable uptick in the supplier deliveries index (to 65.0% from 57.3%), which reflects slower delivery times that are a byproduct of the COVID-19 response that has disrupted supply networks. Translation: the March number is not as encouraging as it seems at first blush.
Total construction spending declined 1.3% m/m in February (Briefing.com consensus +0.5%) on the heels of an upwardly revised 2.8% increase (from +1.8%) in January. Residential spending was down 0.6% m/m while nonresidential spending declined 1.6% m/m.
The key takeaway from the report is that it is relatively meaningless for a market that is pre-occupied with the economic view ahead due to the shutdown measures that started to hit home in March to deal with containing the spread of COVID-19.
The ADP Employment Change report pointed to a net loss of 27,000 nonfarm payrolls in March (Briefing.com consensus -175,000) while the February reading was revised down to 179,000 from 183,000.
The weekly MBA Mortgage Applications Index increased 15.3% following a 29.4% drop in the prior week.

Looking ahead, investors will receive the weekly Initial Claims and Continuing Claims report, the Trade Balance report for February, and the Factory Orders report for February on Thursday.

Nasdaq Composite: -18.0%
S&P 500: -23.5%
Dow Jones Industrial Average: -26.6%
Russell 2000: -35.8%

Market Snapshot
Dow 20943.57 -973.65 (-4.44%)
Nasdaq 7359.93 -339.52 (-4.41%)
SP 500 2470.50 -114.09 (-4.41%)
10-yr Note +26/32 0.631
NYSE Adv 214 Dec 2728 Vol 1.3 bln
Nasdaq Adv 468 Dec 2826 Vol 3.6 bln

Industry Watch
Strong: Consumer Staples
Weak: Financials, Real Estate, Utilities

Moving the Market

-- Stock market loses more than 4% to start the second quarter

-- White House estimates 100,000-240,000 deaths in U.S. due to the coronavirus; projects daily deaths to peak in two weeks

-- President Trump warns of "very painful two weeks"

-- Manufacturing sector contracts, private-sector hiring declines in March

WTI crude settles down 1%
01-Apr-20 15:25 ET
Dow -964.21 at 20953.01, Nasdaq -351.43 at 7348.02, S&P -120.34 at 2464.25

[BRIEFING.COM] The S&P 500 remains near session lows with a 4.6% decline. The Russell 2000 is down 6.8%.

One last look at the S&P 500 sector standings shows utilities (-7.7%), real estate (-7.4%), and financials (-6.1%) leading the retreat, while the consumer staples sector (-1.9%) is the lone sector down less than 3%.

WTI crude settled the session down $0.20 (-1.0%) to $20.32/bbl. It's a volatile market, though, with futures currently up 1.5% to $20.78/bbl.
Oil prices briefly spike on news President Trump will meet with oil execs