Benchmarks ended in the red on Tuesday as investors’ sentiment was mostly marred by the ongoing coronavirus pandemic and its impact on the first quarter. The first quarter of 2020 was the worst for the broader S&P 500 index since 1938.
The three major indices— the Dow Jones Industrial Average, S&P 500 and Nasdaq Composite — closed in the red on Tuesday. The Dow Jones Industrial Average closed at 21,917.16after losing 1.8%, the broader S&P 500 reached 2,584.59 after decreasing 1.6% and the tech-laden Nasdaq Composite hit 7,700.10 after declining1%.
The fear-gauge CBOE Volatility Index (VIX) declined 6.6% to close at 53.54 on Mar 31. Finally, advancers almost matched decliners on the NYSE.
Rising Coronavirus Cases Led Declines
Investors closely followed the spread of the pandemic as economic activities around the globe continued to remain low. Death toll particularly mounted in Spain and the United States, with the number of deceased crossing 3,400 in the latter, per the Johns Hopkins University.
Most of the declines in Tuesday’s trading session were led by defensive stocks including utilities and consumer staples. Apart from these, stocks from the real estate sector joined the losses on Mar 31 as well.
Consumer Confidence Declines Sharply
The Conference Board’s Consumer Confidence Index witnessed a sharp drop in March, following an increase in February. The index dropped to 120 last month from 132.6 in February. A descent in short-term outlook was responsible for the decline in consumer confidence last month, mostly driven by the rise in coronavirus cases in the country.
Benchmarks performed terribly in the month of March, as all the three major indexes incurred more than 10% in losses. The Dow Jones, S&P 500 and Nasdaq Composite shed as much as 12.1%, 11.1% and 10.1% last month, largely dragged down by the sharp decline in economic activities after social distancing measures were enforced in the country. March was the worst month for both the Dow Jones and the S&P 500 after October 2008. As for the Nasdaq, the tech-laden index had its worst month since November 2008.
U.S. stocks witnessed a sharp decline in the first quarter of 2020, as economic and business activities came to a standstill because of the fast-spreading pandemic. The Dow Jones recorded its worst start to a year in history after declining as much as 23.2% in Q1 2020. The broader S&P 500 recorded its worst start to a year since Q4 2008, lagging 20% in the first three months of this year. The Nasdaq, however, had a more limited decline during the same period. The tech-laden index fell 14.2% in Q1 2020, recording its worst quarter since Q4 2018.
Stocks That Made Headlines
Alibaba to Invest in Yunda, Enhance Delivery Services
Alibaba Group Holding Limited BABA is leaving no stone unturned to bolster presence in the retail sector with robust delivery networks. (Read more)
Palo Alto to Fortify Security Offerings With CloudGenix Buyout
Palo Alto Networks PANW recently announced its agreement to acquire software-defined wide area network (SD-WAN) provider — CloudGenix — for approximately $420 million. (Read more)
Today's Best Stocks from Zacks
Would you like to see the updated picks from our best market-beating strategies? From 2017 through 2019, while the S&P 500 gained and impressive +53.6%, five of our strategies returned +65.8%, +97.1%, +118.0%, +175.7% and even +186.7%.
This outperformance has not just been a recent phenomenon. From 2000 – 2019, while the S&P averaged +6.0% per year, our top strategies averaged up to +54.7% per year.
See their latest picks free >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Palo Alto Networks, Inc. (PANW) : Free Stock Analysis Report
Alibaba Group Holding Limited (BABA) : Free Stock Analysis Report
To read this article on Zacks.com click here.