Day Traders Diary
The major averages fell sharply as an emergency rate cut by the Federal Reserve failed to assuage concerns of slower economic growth due to the coronavirus outbreak. The Dow Jones Industrial Average closed down 785 points or nearly 3%, to 25,917 after rising more than 300 points earlier in the day. The S&P 500 fell 2.8% to 3,003 while the Nasdaq Composite pulled back 3% to 8,684.09.
The decision to cut rates by half a percentage point came two weeks before the Fed's scheduled meeting as the central bank felt it was necessary to act quickly to combat the effect of the virus spreading worldwide. It's the first such emergency action coming in between scheduled meetings since the financial crisis.
Newmont Corporation was the top performer in the S&P 500 as gold surged 3.1% to $1643.60/oz. In other commodities, crude oil climbed $0.44, or 0.9%, to $47.23/bbl, recording its second consecutive advance. An OPEC+ panel recommended reducing oil output by 600,000 barrels per day in the second quarter, according to Reuters.
Investors, in turn, loaded up on U.S. Treasuries, pushing the benchmark 10-year yield below 1% for the first time ever. Gold, meanwhile, jumped 2.9% to settle at $1,644.40 per ounce.
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