US stocks suffer worst week since 2008 with investors still unsold on efforts to help coronavirus-hit economy
- US stocks fell on Friday, failing to extend gains from the prior session. Both the S&P 500 and Dow Jones industrial average suffered their biggest weekly declines since 2008.
- Investor confidence continued to waver, even amid efforts from governments and central banks to prop up major economies, shield jobs, and provide liquidity to markets amid the coronavirus pandemic.
- Oil slid after posting a record-breaking gain on Thursday.
- Read more on Business Insider.
US stocks fell on Friday, failing to continue gains from Thursday, as investors remain unsold on widespread actions designed to curb the spread of coronavirus and protect economies around the world.
The White House is working towards finalizing the details of a potential $1 trillion stimulus package to prop up the US economy, while the Federal Reserve has introduced many emergency measures from its toolkit to provide liquidity to markets reeling from the pandemic.
The equity market's losses came after a turbulent trading session that saw the Dow Jones industrial average gain as much as 2.2% before reversing midday and closing at intraday lows. Both the Dow and the benchmark S&P 500 suffered their worst weekly declines since the financial crisis in 2008.
Here's where major US indexes stood at the market close on Friday:
- S&P 500: 2,304.59, down -4.4%
- Dow Jones industrial average: 19,173.43 down 4.6% (914 points)
- Nasdaq composite: 6,879.31, down 3.8%
Government efforts to contain coronavirus have continued. on Friday, President Donald Trump announced that travel across the US-Mexico border will be closed to nonessential travel to try to slow the spread of the virus.
California Gov. Gavin Newsom issued a state-wide order on Thursday for all residents to stay at home to battle the coronavirus spread, and on Friday, New York Gov. Andrew Cuomo said that he would sign an executive order mandating nonessential businesses to keep their workers at home starting Sunday evening.
The market has seen increased volatility this week amid the coronavirus pandemic. The wild swings continued Friday on a day called "quadruple witching," when stock futures and options expire.
"The markets are trying to assess the current situation and causing us to see panic across different sectors," Jeremy Bryan, portfolio manager at Gradient Investments told Business Insider. Market volatility is ensuing because "at the end of the day, we don't know with any great certainty what the coronavirus entails or how long we are going to be in this situation," he said.
Oil slid after rallying on Thursday, when it had its best single-day performance ever. The US dollar has also weakened against a basket of currencies, snapping a rally that's been sparked by investors rushing to the greenback for safety and liquidity.
Uncertainty remains. On Thursday, US jobless claims came in higher than expected, sparking fear that the worst is yet to come as the pandemic continues. A number of major banks including Goldman Sachs, UBS, and Deutsche Bank are now calling for a US recession in the first half of 2020.
"It's not a question of whether or not we're going into a recession it's how deep it's going to be," Quincy Krosby, chief market strategist at Prudential Financial, told Business Insider in an interview. "And how much of a stimulus from the government can cushion the removal of the consumer in the economy?"
There have also been some calls to halt global markets amid the pandemic, although Treasury Secretary said Tuesday during a press conference at the White House that "everyone wants them open."
Although Friday's session was a choppy end to a volatile week, Krosby said that markets appeared calmer heading into the weekend.
"It's been fairly orderly compared to what we've seen over the past few trading sessions," she said, adding that stocks have not been as ferocious on the upside and downside as they were earlier in the week.
She added: "That's comforting even if we end in the red."