Benchmarks closed in the green on Friday posting their biggest one-day gain since October 2008 as President Donald Trump declared a national emergency and released $50 billion of funds to help contain the coronavirus pandemic.
The Dow Jones Industrial Average (DJI) rose 1,985.02 points or 9.4%, to close at 23,185.62 and the S&P 500 rose 230.38 points or 9.3% to close at of 2,711.02. While, the Nasdaq Composite Index closed at 7,874.88, gaining 673.08 points or 9.4%. The fear-gauge CBOE Volatility Index (VIX) decreased 23.4% to close at 57.83. Advancing issues outnumbered declining one for a 5.72-to-1 ratio on the NYSE and a 3.41-to-1 ratio on the Nasdaq favored advancers.
How Did the Benchmarks Perform?
Benchmarks posted their biggest one-day gain since October 2008 after suffering sharp losses in the previous session. On Thursday, stocks made sharp decline, the worst since “Black Monday” market crash in 1987. However, on Friday, Trump’s national emergency declaration and releasing of fund helped investors regain confidence and got reflected from the more than 9% gain that major averages climbed.
All the 11 sectors of the S&P 500 rose at least 2%, with the technology sector taking a lead by gaining 3.7%. Additional boost to the technology stocks came from Apple Inc. (AAPL - Free Report) , after the iPhone maker announced it would reopen all 42 of its branded stores in China. This also boosted the blue-chip Dow index.
Shares of Apple, a Zacks Rank #2 (Buy) company jumped nearly 12% on Friday. While other FAANG stocks, Facebook, Inc. (FB - Free Report) , Alphabet Inc. (GOOGL - Free Report) , Amazon.com, Inc. (AMZN - Free Report) and Netflix, Inc. (NFLX - Free Report) closed10.2%, 9.2%, 6.5% and 6.7%, respectively higher on the same day. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Overall, the S&P index recorded no new 52-week highs buy 14 new lows. Meanwhile, Nasdaq recorded one new high and 153 new lows.
Trump Declared National Emergency
On Friday, President Donald Trump declared a national emergency and released a $50 billion funding to combat the coronavirus pandemic. He also emphasized on ramping up of tests and expanding the ability of hospitals and doctors to provide treatments for the pandemic. Along with that, he said interest payments will be waived on the government’s share of the nearly $1.6 trillion pile of student debt.
Additionally, Trump also asked the Energy Department to purchase oil for the U.S. strategic petroleum reserve. These announcements helped stocks to rally to their session high and also boosted crude prices.
On the other hand, the Federal Reserve said it would ramp up its monthly purchases by purchasing Treasury securities across all durations, starting with 30-year bonds, which would help banks to extend credit to businesses and individuals.
Stocks That Made Headlines
Coronavirus May Hit United Airlines March Revenues by $1.5B
United Airlines Holdings UAL has provided an update on how deeply coronavirus is impacting its business, as the health crisis intensifies across the globe, including the United States, forcing the state and local governments to shut down schools and restricting people to their homes. (Read More)
Apple Shuts Stores Outside China to Reduce Coronavirus Risk
Apple (AAPL - Free Report) has closed all stores outside of Greater China to slow down the spread of coronavirus. In a letter posted on the company’s website, Apple CEO Tim Cook stated that “the most effective way to minimize risk of the virus’s transmission is to reduce density and maximize social distance. (Read More)
For the week ending March 13, all the averages plunged as the coronavirus outbreak clouded investors’ sentiment. The Dow was down 10.4%, while the S&P 500 dropped 8.8% and the Nasdaq declined 8.2%. The Dow had suffered the worst point drop in history and the biggest percentage decline since 1987. And the panic driven by the coronavirus outbreak also pushed the S&P 500 to decline 9.5% on Thursday, its worst day decline in more than three decades. The broader benchmark joined the Dow in a bear market.
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