Benchmarks closed in the negative territory on Monday after lawmakers failed to implement the massive fiscal stimulus designed to ease the economic impact of COVID-19. This overshadowed the Federal Reserves’ move to lend against student loans and credit card loans.
The Dow Jones Industrial Average (DJI) fell 582.05 points or 3%, to close at 18,591.93 and the S&P 500 shed 67.52 points or 2.9% to close at of 2,237.40. While, the Nasdaq Composite Index closed at 6,860.67, dropping 18.84 points or 0.3%. The fear-gauge CBOE Volatility Index (VIX) increased 6.7%, to close at 61.59. Declining issues outnumbered advancing ones for more than 5-to-1 ratio on the NYSE and a 3-to-1 ratio on the Nasdaq favored decliners.
How Did the Benchmarks Perform?
On Monday, the Dow closed at its lowest closing level since November 2016. The Dow was dragged down as oil prices plunged and the energy sector fell 5%. Shares of Exxon Mobil Corporation XOM and Chevron Corporation CVX fell 3.9% and 8.7%, respectively. Both the stocks carry Zacks Rank #5 (Strong Sell). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
However, chip makers stocks help the Nasdaq limit the downside, yet the benchmark ended the session at its lowest closing level in over a year.
Overall, the S&P index recorded no new 52-week highs buy 195 new lows. Meanwhile, Nasdaq recorded two new highs and 401 new lows.
Coronavirus Stimulus Package Fails Again
Investors were highly anticipating that the $1 trillion-plus coronavirus stimulus package would be passed by the U.S. Senate over the weekend. The bill which would authorize fiscal spending to stimulate the economy failed for a second time, as both the Democrats and Republicans could not come to an agreement.
Though the Treasury Secretary Steven Mnuchin said that the Senate would meet again to try and work out a deal, the failure clouded investors’ sentiments. On the other hand, the Federal Reserve announced that it will launch a barrage of programs including purchasing investment-grade securities, and will also remain committed to continue its asset purchasing program.
Stocks that Made Headline
Shell Axes 2020 Capex by $5B, Adheres to $10B Divestment Plans
The oil industry is in disarray, thanks to the coronavirus pandemic that ripped apart most sectors until now. China's fuel demand is visibly dented in the aftermath of large-scale travel bans imposed globally. (Read More)
Alibaba (BABA) Expands in Digital Media Via Yinhekuyu Buyout
Alibaba Group Holding Limited BABA is looking to expand foothold in the digital media and entertainment industry. In this regard, the company recently announced that its subsidiary, Alibaba Pictures has acquired a majority stake in Yinhekuyu Media for about $57 million. (Read More)
Biggest Tech Breakthrough in a Generation
Be among the early investors in the new type of device that experts say could impact society as much as the discovery of electricity. Current technology will soon be outdated and replaced by these new devices. In the process, it’s expected to create 22 million jobs and generate $12.3 trillion in activity.
A select few stocks could skyrocket the most as rollout accelerates for this new tech. Early investors could see gains similar to buying Microsoft in the 1990s. Zacks’ just-released special report reveals 8 stocks to watch. The report is only available for a limited time.
See 8 breakthrough stocks now>>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Exxon Mobil Corporation (XOM) : Free Stock Analysis Report
Chevron Corporation (CVX) : Free Stock Analysis Report
Alibaba Group Holding Limited (BABA) : Free Stock Analysis Report
To read this article on Zacks.com click here.