Stocks Eye Steep Weekly Drop in Volatile Climate

Travel stocks turned even more volatile this week

Patrick Martin
Mar 20, 2020 at 3:28 PM
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If you ever want to simulate the market action from this week, just hop on your nearest roller coaster. Rampant bouts of volatility sent Wall Street on a wild, jarring ride, that included a more than 1,000-point plummet from the Dow Jones Industrial Average (DJI) on Wednesday. Stimulus package hopes tried to give stocks a shot in the arm, but the coronavirus continued to wreak havoc on economic outlooks everywhere. Despite all three benchmarks initially heading for their first back-to-back wins since early February, the Dow, S&P 500 Index (SPX), and Nasdaq Composite (IXIC) were all pacing toward their second straight weekly loss and a steep daily selloff on Friday.

Blue-Chip Boeing Breaks Down

COVID-19 has ripped seemingly infallible Dow stocks apart. No blue chip has had a harder time than Boeing (BA), causing the Trump Administration to toss out a $50 billion loan. Elsewhere Apple (AAPL) and McDonald's (MCD) closed their stores, while Caterpillar (CAT) stock's dip has one analyst urging "buy."

As bad it was for most of Wall Street, there's always some success stories. As the world practices social distancing, cleaning stock Clorox (CLX) has been a favorite among options bulls and analysts. And with face-to-face meetings cancelled for the foreseeable future, video conferencing stock Zoom Communications (ZM) has climbed. The biotech sector is scrambling to combat COVID-19, and so far drug stocks Regeneron Pharmaceuticals (REGN) and Gilead Sciences (GILD) are reaping the benefits of upbeat COVID-19 treatment developments.

Travel Stocks See Volatile Week

With travel discouraged and on the way to being banned, airline stocks such as Delta Airlines (DAL) and American Airlines (AAL) are under immense pressure. Also, the auto sector is doing its part to social distance by scaling down production at U.S. factories. Amid the selloff, we also took a look at what it means for safe-haven assets like this gold exchange traded fund (ETF).

Readying for a Full Week Ahead 

Next week, though most Americans will be staying home, there's still plenty to look forward to. A final revised fourth-quarter gross domestic product (GDP) reading will be heavily scrutinized, as well as earnings from blue-chip retailer Nike (NKE). In the meantime, learn how to track stocks' behavior during a bear market, as well as the S&P 500 trendlines to keep an eye on.


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