US Indexes Fall Tuesday Despite Surprise Fed Rate Cut
The Dow Jones Industrial Average closed at 25,917.41 on Tuesday with a loss of 785.91 points or -2.94%. The S&P 500 closed at 3,003.37 for a loss of 86.86 points or -2.81%. The Nasdaq Composite closed at 8,684.09 for a loss of 268.07 points or -2.99%. The VIX Volatility Index was higher at 36.82 for a gain of 3.40 points or 10.17%.
Tuesday's market movers
There were no major economic reports on the calendar Tuesday. The Federal Open Market Committee announced a surprise interest rate reduction of 50 basis points bringing the target federal funds rate to 1.00% to 1.25%. Fed Chairman Jerome Powell also held a press conference, stating:
"The virus and measures being taken to contain it will weigh on economic activity here and abroad for some time."
Despite the Fed's stimulus, the coronavirus continued to worry investors with spreading in the U.S. The U.S. has 118 confirmed infections with nine deaths, all in Washington State. News Tuesday also reported a tornado that killed approximately 19 people in Tennessee.
Treasury yields were lower on the day's news. The 10-year Treasury's yield dropped below 1% for the first time ever and ended the day at 0.97%.
The G7 held a special conference call to discuss needs for mitigating infections of the coronavirus. The Democrats are also holding their Super Tuesday Primaries.
Retailers rounded out the end of the fourth-quarter earnings season with reports from Target (NYSE:TGT), Kohl's (NYSE:KSS), Ross Stores (NASDAQ:ROST) and Nordstrom (NYSE:JWN).
In the S&P 500, technology and financials led losses. In the Dow Jones Industrial Average, the following stocks led losses:
American Express (NYSE:AXP) -5.15%
3M (NYSE:MMM) -5.08%
Microsoft (NASDAQ:MSFT) -4.89%
Small-cap stocks
In small caps, the Russell 2000 closed at 1,486.08 for a loss of 32.41 points or -2.13%. The S&P 600 closed at 888.60 for a loss of 19.29 points or -2.12%. The Dow Jones U.S. Small-Cap Growth Index closed at 9,685.62 for a loss of 209.69 points or -2.12%. The Dow Jones U.S. Small-Cap Value Index closed at 8,460.28 for a loss of 213.27 points or -2.46%.
Other notable indexes
Other notable index closes included the S&P 400 Mid-Cap Index at 1,835.19 for a loss of 40.28 points or -2.15%; the S&P 100 at 1,346.23 for a loss of 42.48 points or -3.06%; the Nasdaq 100 at 8,594.49 for a loss of 283.49 points or -3.19%; the Russell 3000 at 1,756.96 for a loss of 48.76 points or -2.70%; the Russell 1000 at 1,661.36 for a loss of 46.77 points or -2.74%; the Wilshire 5000 at 30,687.11 for a loss of 854.90 points or -2.71%; and the Dow Jones U.S. Select Dividend Index at 669.13 for a loss of 15.74 points or -2.30%.
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This article first appeared on GuruFocus.
