TGIF? That is hardly the case for Wall Street investors who own stocks in the Dow Jones Industrial Average, which recorded a dubious distinction.
Friday sessions have been marked by dread among investors lately because of the uncertain landscape that the coronavirus outbreak has created heading into weekends.
Case in point, the 124-year-old blue-chip index US:DJIA closed lower Friday, marking its longest run of Friday losses, seven straight, since the string of eight straight Friday losses that ended July 2006, according to Dow Jones Market Data.
Specifically, the Dow lost 257 points on the session, or 1%, at 25,864, after shedding as many as 894 points, or 3.4%, at its Friday low. On the upside, the index finished the week 1.8% higher. Meanwhile, the S&P 500 US:SPX closed down 1.7% and the Nasdaq US:COMP booked a 1.9% loss.
“Fridays have become the scariest day of the week because we know with a high percentage of certainty that there’s going to be more bad news, and we have seen how that manifests in equity valuations,” Art Hogan, chief market strategist at National Securities, told MarketWatch on Thursday.
The viral outbreak that was first identified in Wuhan, China, in December has sickened nearly 98,000 people and claimed at least 3,300 lives so far, spreading around the globe.
A series of travel restrictions put in place by various governments as well as policies from large employers recommending that workers reconsider business and even personal trips in some instances is negatively impacting the travel industry and is likely to dent the global, if not the domestic, economy.
On Friday, the number of cases of COVID-19 globally topped 100,000, with more than 20% of the new cases emerging in countries outside of China, the Wall Street Journal reported, citing data from Johns Hopkins University.
For that reason, the Federal Reserve cut benchmark interest rates on Tuesday by a half percentage point to the 1%-to-1.25% range, marking the first time the central bank has conducted an emergency rate cut since the 2008 financial crisis. Market participants are now anticipating another half-point cut at the Fed’s scheduled March 18 meeting.
Read:What the Fed’s surprise interest rate cut means for mortgage rates
The infectious disease is an exogenous factor that economists and investors are finding difficult to model, and weekends have come with a greater — though somewhat expected — degree of incidence increases outside of China and new steps by governments to limit the outbreak, which in turn threaten to slow down economic expansion.
See:Fed expected to continue cutting interest rates, beginning as soon as later this month
Testing for the illness hasn’t gotten under way robustly in the U.S. because the U.S. Centers for Disease Control and Prevention initially distributed flawed tests, USA Today reported.
At least 234 people have tested positive for COVID-19 in the U.S., and 14 have died, as of Wednesday, according to figures from the Johns Hopkins data.
Large corporations including Google parent Alphabet Inc. US:GOOGL US:GOOG and Microsoft US:MSFT have asked staffers to work from home, and shares of air carriers Delta Inc. US:DAL, American Airlines US:AAL and United Airlines Holdings Inc. US:UAL, as well as the travel site Tripadvisor Inc. US:TRIP, have been hammered by flight cancellations and reduced business and personal travel.
Even before the coronavirus anxiety reached its recent apex the Dow has been trading tentatively on Fridays. So far this year, the blue-chip benchmark has been down eight of the past nine Fridays:
|Friday performance in 2020||% moves for the DJIA|
|Source:FactSet and Dow Jones Market Data|