 The Market Sum | Insight after the bell
By Caleb Silver, Editor in Chief 
Wednesday's Headlines 1. US markets sink as growth forecasts drop 2. NYSE to close trading floor March 23rd 2. Oil plunges 24%—third worst decline in history 3. Commodity prices at lowest levels since 2002 4. Individual investors keep on buying stocks Markets Closed
 Courtesy of Lars Baron/Getty Images
Markets Today Another vicious sell-off across global markets today, and the fearful sentiment raged its way throughout nearly all securities and U.S. indexes, forcing another trading halt as circuit breakers were triggered at the NYSE. U.S. markets did rebound with 10 minutes to go before the market close, perhaps on news that the U.S. Senate will pass a stimulus bill that could total more $1.3 trillion. Details of what's in the bill will not be made available until it is formally passed, but Senate Majority Leader Mitch McConnell said the bill that senators were drafting would provide a "historic injection of liquidity and access to credit" for small businesses, while loosening the bureaucracy for lenders working with the federal government.
That may cushion the blow, but the massive drop across stocks, commodities, and corporate bonds is doing some lasting damage to investors and their financial plans.
Oil prices plunged 24% today at their lows, the third worst day on record for the commodity. U.S. Treasury prices fell and yields climbed to 1.2% for the 10-year benchmark, tripling from last week's lows. Even gold prices fell as investors rushed to liquidate anything they could to raise cash and prepare for a downturn. Just how deep and how long that will last is anyone's guess, and plenty of people are guessing. Here's JPMorgan's latest GDP forecast for the U.S.:
The bad news will taper off one day... just not today.
Stay brave and hug your loved ones.
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Headlines:
 chart courtesy tradingeconomics.com
Commodities Fall to 18-Year Low Beyond the crash in oil prices, most other major commodities are in a historic free fall as well. The CRB Commodity Index has fallen to lows it hasn't seen since 2002.
The index consists of 19 commodities: aluminum, cocoa, coffee, copper, corn, cotton, crude oil, gold, heating oil, lean hogs, live cattle, natural gas, nickel, orange juice, RBOB gasoline, silver, soybeans, sugar, and wheat.
Those commodities are sorted into four groups, each with different weightings: Energy: 39%, Agriculture: 41%, Precious Metals: 7%, and Base/Industrial Metals: 13%.
Fossil fuel prices matter... a lot. But the economic repercussions of a 41% plunge in agricultural prices will have serious consequences around the world.
 How are Individual Investors Doing? Despite the agonizing pain of looking at our retirement accounts (which is something we should try not to do...) individual investors are proving to be a hearty and brave bunch.
The AAII Sentiment survey released on March 11th showed that more investors were feeling bearish than in the past seven years. Still, nearly 30% felt bullish. Then a massive rate cut happened and trillions of dollars in monetary policy have been pledged to backstop the economy and the financial system. We know from our own Anxiety Index that investors are very scared about a depression, job losses, bankruptcies, and just about every fear factor you can think of.  What Are They Buying? Still, they are buying stocks through the sell-off, just like they did last week. According to Fidelity Investments, one of the biggest brokers for retail investors, their ratio of stock purchases over sales is 2:1.
And what are they buying? Check out the latest trade report from Fidelity, below. 
(chart courtesy YCHARTS)  Shares of chemical company Dow are up by nearly 21% as demand in China increases, seemingly as a result of the coronavirus' impact on the country beginning to lessen. Consolidated Edison's share price increased by 18% today; ConEd is one of several energy companies being pressured to "keep the lights on" in spite of many customers being unable to pay their utility bills due to pandemic-related unemployment.  Shares of oil and gas company Noble Energy are down by nearly 20% as a result of the ongoing oil crash. Apache, another company in the same industry, continues its descent from yesterday, with its stock price having fallen by over 18%. Word of the Day A demand shock is a sudden surprise event that temporarily increases or decreases demand for particular goods or services. A positive demand shock is a sudden increase in demand, while a negative demand shock is a decrease in demand. Both a positive demand shock and a negative demand shock will have an effect on the prices of goods and services.  image courtesy amex.com
Today in History March 18th, 1950: Henry Wells, William G. Fargo, and John Butterfield meet at the Mansion House in Buffalo to join their separate companies—Wells & Co.; Livingston, Fargo & Co.; and Butterfield and Watson—into a single firm with a monopoly over express shipping in the northeast. They capitalized their American Express Co. with $150,000 in stock. At first, AmEx specialized in shipping small valuables like bond certificates, currency, and financial contracts—plus live poultry, pianos, and firecrackers.
Reed Massengill, Becoming American Express: 150 Years of Reinvention and Customer Service (American Express, New York, 1999), pp. 10–17.
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Wednesday, March 18, 2020
Facing the Fear
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