Volatility-Weary Wall Street Sinks Again

By Kim Khan 

Investing.com – Volatility continued to dominate Wall Street trading Friday, with stocks lower but swinging around on a myriad of headlines regarding the global impact of Covid-19.

Investors are dealing with a disease that is rapidly spreading, government responses whose effectiveness is questionable, bureaucratic standoffs in the case of OPEC and Russia, and a real ambiguity on whether good economic data is really good news given interest rate expectations.

And the market as a whole looks genuinely baffled.

The fell 2.3%, the lost 2.3% and the was down 2%, or 517 points.

The major indexes were well off their early lows. Losses were trimmed after White House Adviser Larry Kudlow said the U.S. was considering fiscal stimulus measures to combat the impact of Covid-19.

Data compiled by John Hopkins University showed that there are now 233 confirmed cases in the U.S., with 14 deaths recorded, of which 12 were in a single county in Washington state.

But strategists also said the bounce could also have been triggered by short-covering or algorithmic buy orders.

Stocks opened sharply lower as selling accelerated in futures following a better-than-expected report. The economy added 273,000 jobs in February, far more than the 175,000 expected. January’s hiring was also revised up.

While that looked like good news for the economy, it puts the Federal Reserve in a tougher position to justify more easing. That’s disappointing to an easy-money addicted market that’s calling for a further 75 basis points in rate cuts by mid-April.

The energy sector sank 3.5% as oil prices plunged more than 8% following reports that OPEC and Russia not only failed to agree on new output cuts to bolster prices, rolling over current output cuts was in question.

Among individual stocks, JPMorgan (NYSE:) stock fell 5% after the bank confirmed that chairman and CEO Jamie Dimon had had to undergo heart surgery. The bank will be run jointly by its two co-chief operating officers while Dimon recovers.

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