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Quarterly Market Review

Quarterly Market Review

Quarterly Market Review: January – March 2020

The Markets (first quarter through March 31, 2020)

The world’s economies and stock markets have been rocked by the spread of COVID-19. Investors’ fears prompted a major sell-off in February and March, plunging stocks well below their 2019 closing marks. Nevertheless, 2020 started off in a positive way. Following a strong 2019, stocks were slow to move forward as investors cashed in some of their 2019 gains. But by mid-January, each of the benchmark indexes were safely ahead of their 2019 closing marks. However, concerns over the COVID-19 outbreak in China quelled investor optimism. By the end of January, only the small caps of the Nasdaq remained ahead of their prior year’s pace, as each of the remaining indexes listed here fell into the red.

February started off as January ended, with investors more inclined to sell rather than buy equities. However, word of China’s plans to cut tariffs on some U.S. imports sent stocks higher during the second week of the month. The Nasdaq was more than 6% over its 2019 year-end value while both the S&P 500 and the Dow also pushed ahead. But by the third week of February, the impact of the virus was becoming evident with news of a widespread outbreak in South Korea. Selling accelerated the following week as outbreaks were reported in Iran and Italy. As more cases were reported in the United States, investors feared that containment of the virus was not likely and rushed to cash in stocks. By the end of February, each of the indexes lost significant value led by the Dow, which fell more than 10% for the month.

March 2020 will surely go down as one of the most turbulent months. COVID-19 continued to spread worldwide. In the United States, confirmed cases and, unfortunately, deaths spiraled. Fear became the motivating factor in our daily lives — fear of catching the virus, fear of the illness affecting our loved ones, fear of losing our jobs, fear of economic failure, and fear of losing our money. With respect to the stock market, this fear manifested itself in a major sell-off for most of the month. After falling sharply during the last week of February, stocks rebounded marginally to open the month. But that push was short-lived as stocks plummeted dramatically mid-March, despite the announcement of new actions and legislation by the Federal Reserve, Congress, and the President. On March 20, each of the benchmark indexes listed here posted double-digit losses. Year to date, the major indexes were more than 20% behind their 2019 closing values. The passage of the CARES Act at the end of the month helped ease investors’ concerns enough to move back to stocks. The end of the month saw each of the benchmark indexes post major gains, with the Dow marking its best single day since 1938. However, the spike in index values was not nearly enough to offset the major losses sustained throughout the month. March saw the Dow fall almost 14%, the S&P 500 drop over 12%, the Nasdaq lose 10%, the Global Dow give back close to 15%, and the small caps of the Russell 2000 plunge nearly 22%.

The first quarter of 2020 closed with each of the benchmark indexes securely in the red compared to their 2019 year-end values. The Russell 2000 again suffered the largest three-month fall, closing the quarter down nearly 31%. The Dow suffered its worst quarter since 1987, while the broader-based S&P 500 hasn’t seen a quarterly decline this bad since 2008. The Nasdaq fell more than 14%, marking its worst quarter since 2018. The Global Dow fell over 24% for the quarter.

By the close of trading on March 31, the price of crude oil (WTI) had sunk to $20.35 per barrel, well below the February 28 price of $45.19 per barrel. The national average retail regular gasoline price was $2.120 per gallon on March 23, down from the February 24 selling price of $2.466 and $0.503 less than a year ago. The price of gold finished March at $1,591.20, slightly higher than its February closing value of $1,585.80.

Market / Index 2019 Close As of 3/31 Month Change Quarter Change YTD Change
DJIA 28538.44 21917.16 -13.74% -23.20% -23.20%
NASDAQ 8972.60 7700.10 -10.12% -14.18% -14.18%
S&P 500 3230.78 2584.59 -12.51% -20.00% -20.00%
Russell 2000 1668.47 1153.10 -21.90% -30.89% -30.89%
Global Dow 3251.24 2469.53 -14.84% -24.04% -24.04%
Fed. Funds 1.50%-1.75% 0%-0.25% -150 bps -150 bps -150 bps
10-year Treasuries 1.91% 0.69% -43 bps -122 bps -122 bps
Market/Index DJIA
2019 Close 28538.44
As of 3/31 21.917.16
Month Change -13.74%
Quarter Change -23.20%
YTD Change -23.20%
Market/Index NASDAQ
2019 Close 8972.60
As of 3/31 7700.10
Month Change -10.12%
Quarter Change -14.18%
YTD Change -14.18%
Market/Index S&P 500
2019 Close 3230.78
As of 3/31 2584.59
Month Change -12.51%
Quarter Change -20.00%
YTD Change -20.00%
Market/Index Russell 2000
2019 Close 1668.47
As of 3/31 1153.10
Month Change -21.90%
Quarter Change -30.89%
YTD Change -30.89%
Market/Index Global Dow
2019 Close 3251.24
As of 3/31 2469.53
Month Change -14.84%
Quarter Change -24.04%
YTD Change -24.04%
Market/Index Fed. Funds
2019 Close 1.50%-1.75%
As of 3/31 0.00%-0.25%
Month Change -150 bps
Quarter Change -150 bps
YTD Change -150 bps
Market/Index 10-year Treasuries
2019 Close 1.91%
As of 3/31 0.69%
Month Change -43 bps
Quarter Change -122 bps
YTD Change -122 bps

Chart reflects price changes, not total return. Because it does not include dividends or splits, it should not be used to benchmark performance of specific investments.