U.S. markets went through a virtual bloodletting Monday as stocks cratered throughout to record losses — including a 2,013-point fall for the Dow — plus more in today’s Closing Bell on Money and Markets.
The Top Story
Brutal might be a gross understatement when it comes to market performance on Monday.
All three major U.S. stock indexes were bludgeoned on news Saudi Arabia is ratcheting up its oil production to drop oil prices and force Russia to the negotiating table regarding oil policy.
Trading was halted early in the morning after the S&P 500 dropped 7% as the market opened. That triggered a “circuit breaker” policy to close off trading temporarily. However, it did little to stop the bleeding as investors continued to sell off throughout the day.
The Dow Jones Industrial Average dropped more than 2,000 points during the afternoon trading session, shattering its record point losses in one day of 1,190 set way back on Feb. 20, 2020. The S&P 500 was also on pace to set a record for the fastest 20% drop from a record high.
As I write, the S&P 500 is down 17% to 18% from the February 19, 2020 all-time high. That was just 13 trading ago.
Fastest for the S&P 500 from an all-time high to down 20%
* September/October 1929 = 42 days
* August to October 1987 = 55 days
* July to October 1990 = 87 days— Jim Bianco (@biancoresearch) March 9, 2020
As a result of the Saudi Arabia oil production increase, both Brent and West Texas Intermediate crude futures dropped more than 24% — pacing for their worst day since 1991.
The benchmark 10-year U.S. Treasury yield fell to 0.51% as investors continued to pour into bonds and other safe havens to guard against the decline of equities.
As of 3 p.m. EDT, the Dow dropped 7.2%. The S&P 500 fell more than 7.2%, while the Nasdaq Composite lost 6.5%.
Money and Markets: Closing Bell*
S&P 500: 2,757 (-225 points, -7.6%)
DOW: 23,989 (-2,013 points, -7.8%)
NASDAQ: 8,012 (-624 points, -7.3%)
GOLD: $1,671.80 (+$3.20, +0.2%)
BITCOIN: $7,859.80 (-$215.99, -2.7%)
U.S. 10-YEAR YIELD: (-0.159, 0.548%
*- as of 4:30 p.m.
A Big Win
In this morning’s Wall Street Wake-Up, your “be on the lookout” included Diamondback Energy Inc. (Nasdaq: FANG). The company said it was scaling back its operations due to the drop in oil prices. Shares of Diamondback fell nearly 45% through afternoon trading.
Another oil and gas giant we mentioned taking a hit Monday was BP PLC (NYSE: BP). The British-based company cratered along with other oil companies, falling 18.3% in afternoon trading.
M&A News
Aon PLC (NYSE: AON) is acquiring Willis Towers Watson PLC (Nasdaq: WLTW) for nearly $30 billion. The acquisition will merge the second- and third-largest insurance brokerages.
Compass Diversified Holdings (NYSE: CODI) is buying baseball and softball equipment manufacturer Marucci Sports for $200 million.
Golden Nuggets
Despite an early surge, precious metals scaled back in afternoon trading as investors reeled from equities’ nosedive.
Gold futures fell 0.03% to $1,671.80 an ounce while silver futures dropped 1.6% to $16.98 an ounce.
Platinum lost 3.6% to $863.90 an ounce and palladium dropped 2% to $2,389 an ounce.
Cannabis Corner
Marijuana firm BR Brands is planning a $43 million takeover of Denver-based Dixie Brands.
Dixie Brands manufactures cannabis-infused products.
Under the terms of the deal, BR Brands will own 80% of the new company while Dixie Brands shareholders will have 20%.
The deal is expected to be completed in the third quarter of this year. Dixie Brands CEO and president Chuck Smith will be the CEO and president of the merged company.
Stock Market Update
While most stocks were in free fall, there were some defensive positions that actually saw increases.
Shares of discount stores Dollar Tree Inc. (Nasdaq: DLTR) and Dollar General Corp. (NYSE: DG) were up in afternoon trading. Dollar Tree shares jumped 4.7% while Dollar General was up 0.4%.
Clorox Co. (NYSE: CLX) has seen its share price jump more than 10% in the last month and touched a 52-week high of $177.77. It was the only company in the S&P 500 to hit a high Monday.
Today’s Big Winners:
(as of 3:15 p.m. EDT)
Dollar Tree Inc. (Nasdaq: DTLR) +4.3%
Autozone Inc. (NYSE; AZO) +4.2%
O’Reilly Automotive Inc. (Nasdaq: ORLY) +2.5%
Cabot Oil & Gas Corp. (NYSE: COG) +1.8%
Advance Auto Parts Inc. (NYSE: AAP) +1.3%
Today’s Big Losers:
(as of 3:15 p.m. EDT)
Marathon Oil Corp. (NYSE: MRO) -50.6%
Apache Corp. (NYSE: APA) -47.4%
Diamondback Energy Inc. (Nasdaq: FANG) -43%
Occidental Petroleum Corp. (NYSE: OXY) -41.7%
Halliburton Co. (NYSE: HAL) -38.1%
Editor’s note: How big of a hit did you take Monday and how are you feeling about where things are heading? Are you getting defensive or still feeling bullish with stocks on sale? Let us know in the comments below.
Check back for the most important news and numbers each day after the Closing Bell, only on Money and Markets.
Don’t forget about “Marijuana Markets: a POTcast,” featuring the biggest cannabis news and investment notes from Banyan Hill’s Anthony Planas, here on Money and Markets each Saturday morning.