Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

U.S. markets seen robust despite surging volumes on coronavirus fears

Stock MarketsMar 03, 2020 03:13AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 

By John McCrank

NEW YORK (Reuters) - The stock market rout last week over fears the coronavirus could trigger a recession was the worst since the 2008 financial crisis, but market experts said on Monday trade was mostly orderly thanks to a robust market infrastructure.

The S&P 500 (SPX) tumbled 11.5% last week before staging a partial rebound on Monday on hopes central banks will seek to ease the economic impact of the epidemic through rate cuts.

On Friday alone the market turned over 19.35 billion shares, the second highest amount on record behind 19.76 billion on Oct. 10, 2008, said Larry Tabb, founder of research and consultancy firm Tabb Group. In terms of value, just under $1 trillion traded hands, a record total for a single day, he said.

Despite the volatility, buyers and sellers had a relatively easy time connecting, Tabb said.

"I'm not sure you can argue that many people felt prices were reasonable, but generally, things went smoothly," he said.

On the retail side, TD Ameritrade said trading volume last week by its 11 million clients was 1.5 times higher than earlier in February, with above-normal activity registered on both the buying and selling sides.

"People may not have liked what happened, but the way in which it happened was actually pretty impressive," said JJ Kinahan, chief market strategist at the online brokerage.

The U.S. markets are highly automated, with millions of messages processed each second, and much of last week's move was likely computer-driven, led by professional traders, said Ben Carlson, director of institutional asset management at Ritholtz Wealth Management.

He said he did not notice any major flash crash-type price spikes or major discrepancies between exchange-traded fund prices and the prices of their underlying constituents.

Kinahan noted two instances of possible panic selling at the market close on Thursday or Friday, but those may have been due in part to large derivatives positions being unwound.

TMX Group (TO:X), Canada's largest exchange operator, shut down its venues two hours earlier than normal on Friday due to capacity issues.

And Robinhood, the free trading app popular with young investors, experienced a system-wide outage on Monday as stock prices rebounded, according to CNBC.

Markets should expect to see more sharp selling if the coronavirus spreads in New York but markets would likely continue to function even if the floor of the New York Stock Exchange had to close.

One case of the virus has been confirmed in New York, of a health care worker who was traveling in Iran.

"Volatility doesn't just die after things like this," said Kinahan. "It takes a while to work through the system."

U.S. markets seen robust despite surging volumes on coronavirus fears
 

Related Articles

Stocks rally, dollar gains as Omicron fears ease
Stocks rally, dollar gains as Omicron fears ease By Reuters - Dec 06, 2021 28

By Herbert Lash NEW YORK (Reuters) -The dollar edged higher while U.S. and European shares rallied on Monday after easing concerns about the Omicron coronavirus variant led...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email