Barron\'s 03.16.2020

March 9 through March 13, 2020

Euro Trader P. M4

Emerging Markets P. M4

Commodities P. M6

Striking Price P. M7

Inside Scoop P. M8

13D Filings P. M8

Power Play P. M8

Charting the Market P. M9

Winners & Losers P. M10

Research Reports P. M11

Market View P. M12

Statistics P. M13

21,185.62

52-wk:-10.30%YTD:-18.76%Wkly:-10.36%

Dow Jones Industrials

2711.02

S&P 500

52-wk:-3.95%YTD:-16.09%Wkly:-8.79%

7874.88

Nasdaq Composite

52-wk:+2.42%YTD:-12.23%Wkly:-8.17%

241.29

S&P 500 Energy (Sector)

52-wk:-50.23%YTD:-47.14%Wkly:-24.28%

2/12/2020 19 Days

8/25/1987 38 Days

9/3/1929 43 Days

1/14/2000 417 Days

1/11/1973 220 Days

1/19/1906 347 Days

12/13/1961 114 Days

2/9/1966 134 Days

6/17/1901 144 Days

10/9/2007 184 Days

11/21/1916 59 Days

7/16/1990 62 Days

11/3/1919 77 Days

9/5/1899 84 Days

0 15 30 45 60 75 90 105 120 135 150 165 180 195 210 225 240 255 270 285 300 315 330 345 360 375 390 405 420 435

ALL TIME HIGH TO ENTER BEAR MARKET IN DAYS Source: Dow Jones Market Data

MARKET PERFORMANCE DASHBOARD

TheDowplungedfromitsall-timehightoabearmarket

in just 19 days, the fastest such decline on record.

The Fastest Fall

To Bear Territory

THE TRADER

What to Do

Now That

We’ve Had

AMarket

Panic

T

his is what a market

panic feels like. But

now that the storm

has made landfall,

it’s time for un-

nerved investors to

sort out a few

things: What just happened, why did it

happen, and, most important, what

should they do next. The pros have

some advice: Don’t be too cautious.

What just happened? The coronavi-

rus was declared a pandemic by the

World Health Organization. Saudi Ara-

bia announced a huge output increase,

sending oil prices plunging. Forrest

Gump contracted the coronavirus.

There are no basketball scores to

check. Baseball won’t start on time this

spring. And President Donald Trump

declared a national emergency on Fri-

day after announcing a European

travel ban on Wednesday.

Investors had a brutal week. All

three major U.S. indexes fell into bear-

market territory, ending an 11-year

bull market in U.S. stocks.

The Dow Jones Industrial Average

fell 2,679 points, or 10.4%, to

23,185.62. The S&P 500 dropped

8.8%, to 2711.02, and the Nasdaq

Composite dropped 8.2%, to 7874.88.

It was one of the 20 worst weeks of all

time for the Dow. The weekly Dow

drop came despite an epic 1,985-point

rally on Friday.

The numbers are breathtaking.

They will be talked about by our chil-

dren’s children.

“This stinks, it’s horrible, we hate

it,” Bill Smead of Smead Capital tells

Barron’s, reflecting on the recent trad-

ing action. Unmitigated selling pres-

sure causes a panic. No one likes a

panic, but stock-market history is

dotted with them.

“Most of the clients we speak to

don’t feel like they are panicking,”

says RBC head of U.S. equity strategy

Lori Calvasina. That might be true,

but that is the nature of a market

panic. No one suggests people act

against their own economic self-inter-

est. But in a panic, the buy orders dry

up. Traders step back because of ex-

treme volatility. That leaves, essen-

tially, an imbalance of sell orders.

There are, of course, new risks for

investors to discount. Some, like a pan-

demic, are hard to understand. If inves-

By Al Root

MARKET WEEK