US close: Stocks trim losses late in the session as stimulus ramps up
The Dow Jones Industrials fell below the 20,000 point mark for the first time since 2017, dragged down by losses in stocks most impacted by the coronavirus pandemic such as civil aerospace and another outsized leg lower for crude oil futures.
Stocks did however manage to pare their losses towards the end of the session, helped by reports that lawmakers in Congress might announce a roughly $1.3trn stimulus package by the next day, on top of a more than $100bn of spending to finance free testing and paid sick leave announced earlier on Wednesday.
Markets were also reacting to news that the government might be open to taking equity stakes in private firms as part of an aid package.
There was also speculation that the Federal Reserve would soon ramp up its quantitativeeasing programme from $700bn in Treasuries and mortgage backed securities to $1.5trn.
By the end of trading, the Dow Jones Industrials was down 6.3% to 19,898.92, alongside a 5.18% fall on the S&P 500 to 2,398.10, while the Nasdaq Composite was off 4.70% to 6,989.84.
Weighing on the former were shares in aerospace giants Boeing and United Technologies, amid 'market chatter' of the possible need of a bail-out for the first of those two companies while at one point United Technologies was down by the most since the 11 September attacks.
The country's major auto manufacturers also announced plans to shutter plants at the request of the UAW, with Harley Davidson announcing similar plans.
Another precipitous fall in crude oil futures also hit markets.
Front month West Texas crude oil futures were down 18.67% at $22.71 a barrel on the ICE.
"Huge drops for oil prices have overshadowed the renewed fall in equity markets, and the overall tone remains firmly risk-averse," said IG's Chris Beauchamp.
"Even then, the assumption is still that the US has a lot more to come in terms of infections and deaths, something which will put a roof on any medium-term gains."
Linked to the above, oil major Conoco Phillips announced plans to reduce its capital spending budget for 2020 by 10% to $700m, in order to adjust to the steep drop in energy quotes - chiefly through a reduction in Alaskan drilling.
In parallel, the yield on the benchmark 10-year US government bond was again higher at 1.22% following a near 30 basis point jump during the previous session.
According to the US Department of Commerce, housing starts fell at a 1.5% month-on-month pace in February to reach an annualised clip of 1.624m (consensus: 1.599m).
Permits to start building, typically a closely-followed lead indicator, dropped 5.5% on the month to reach 1.464m (consensus: 1.5m).
IHS Markit cut its forecast for world GDP growth in 2020 to 0.7%, which was roughly a percentage point less than anticipated by already bearish economists, while JP Morgan was reportedly expecting a 14% drop in US GDP in the second quarter in annualised terms.
Dow Jones - Risers
Walgreens Boots Alliance, Inc. (WBA) $52.81 6.47%
Cisco Systems Inc. (CSCO) $37.12 4.56%
Walmart Inc. (WMT) $122.58 2.78%
3M Co. (MMM) $137.02 1.92%
Pfizer Inc. (PFE) $32.36 0.62%
Verizon Communications Inc. (VZ) $54.32 0.02%
Dowdupont Inc. (DWDP) $30.52 0.00%
Caterpillar Inc. (CAT) $100.12 -0.08%
Procter & Gamble Co. (PG) $117.45 -0.67%
Johnson & Johnson (JNJ) $134.96 -1.19%
Dow Jones - Fallers
Chevron Corp. (CVX) $55.05 -22.11%
Boeing Co. (BA) $101.89 -17.92%
Travelers Company Inc. (TRV) $81.69 -15.27%
American Express Co. (AXP) $73.75 -14.82%
United Technologies Corp. (UTX) $79.40 -14.48%
Goldman Sachs Group Inc. (GS) $140.02 -11.75%
Unitedhealth Group Inc. (UNH) $217.06 -11.12%
JP Morgan Chase & Co. (JPM) $83.89 -10.53%
Home Depot Inc. (HD) $155.63 -10.37%
Exxon Mobil Corp. (XOM) $33.12 -10.02%
S&P 500 - Risers
Akamai Technologies Inc. (AKAM) $97.10 9.80%
Gilead Sciences Inc. (GILD) $79.42 6.58%
Walgreens Boots Alliance, Inc. (WBA) $52.81 6.47%
Nordstrom Inc. (JWN) $19.76 5.56%
Arista Networks Inc. (ANET) $177.00 5.23%
Baxter International Inc. (BAX) $84.59 5.07%
FedEx Corp. (FDX) $99.68 4.97%
Lockheed Martin Corp. (LMT) $333.41 4.57%
Cisco Systems Inc. (CSCO) $37.12 4.56%
Extra Space Storage (EXR) $89.97 4.34%
S&P 500 - Fallers
Coty Inc. Class A (COTY) $3.74 -31.38%
Wyndham Destinations Inc. (WYND) $17.73 -30.55%
United Airlines Holdings Inc (UAL) $21.38 -30.29%
ONEOK Inc. (OKE) $15.37 -28.48%
Mosaic Company (MOS) $7.01 -27.51%
Carnival Corp. (CCL) $9.30 -26.83%
Discover Financial Services (DFS) $27.00 -26.77%
Alliance Data Systems Corp. (ADS) $22.61 -26.76%
Macerich Co (MAC) $6.63 -26.42%
Delta Airlines Inc. (DAL) $23.49 -25.99%
Nasdaq 100 - Risers
Gilead Sciences Inc. (GILD) $79.42 6.58%
Walgreens Boots Alliance, Inc. (WBA) $52.81 6.47%
Cisco Systems Inc. (CSCO) $37.12 4.56%
Paychex Inc. (PAYX) $63.30 4.13%
Citrix Systems Inc. (CTXS) $130.50 2.39%
Amazon.Com Inc. (AMZN) $1,830.00 1.23%
Vertex Pharmaceuticals Inc. (VRTX) $212.98 1.21%
Alexion Pharmaceuticals Inc. (ALXN) $82.50 0.17%
Costco Wholesale Corp. (COST) $307.50 0.17%
Hasbro Inc (HAS) $46.82 0.15%
Nasdaq 100 - Fallers
American Airlines Group (AAL) $11.65 -25.22%
Wynn Resorts Ltd. (WYNN) $43.02 -20.89%
Asml Holdings N.V. (ASML) $196.99 -17.35%
Ulta Salon, Cosmetics & Fragrance Inc. (ULTA) $128.52 -16.87%
Tesla Inc (TSLA) $361.22 -16.03%
Broadcom Inc. (AVGO) $167.87 -15.86%
Expedia Group Inc. (EXPE) $45.65 -15.65%
Lam Research Corp. (LRCX) $194.14 -15.33%
Marriott International - Class A (MAR) $63.81 -15.19%
Cintas Corp. (CTAS) $177.98 -14.89%