Market twists expected to continue
Wisconsin companies mostly down at end of week
Wall Street’s breathtaking, virusfueled, up-and-down rocket-ride week concluded on a sharply up note, but shares in most companies still saw some brutal losses, including those for Wisconsin companies.
It could have been even worse, but for a powerful Friday afternoon rally.
The turnaround wrapped up a week that saw heightened fears that the coronavirus outbreak will lead to a global recession.
On Friday, the Dow Jones Industrial Average’s gains doubled in the last halfhour of trading as President Donald Trump declared the outbreak a national emergency.
The index closed up nearly 2,000 points, up 9.4%, its biggest percentage gain since 2008 and capping a rally that recouped many of the losses from a day earlier. That’s when the index saw its worst slide since the Black Monday crash of 1987 and European indexes had one of the worst drops on record. The major indexes each closed with gains of more than 9%.
The week’s staggering price swings left traders and money managers exhausted by the time markets closed on Friday.
They are expecting more of the same heading into trading on Monday.
“The volatility is not going to end. It’s going to go on for some time,” said Michael Sadoff, an investment adviser and co-owner of Sadoff Investment Management in Glendale, Wisconsin.
The market’s rout intensified amid a torrent of cancellations and shutdowns worldwide. Business closures have fueled fear that a severe pullback in consumer and business spending will tip the U.S. economy into a recession and wreck corporate profits.
Even with Friday’s pickup, the market was on track for its worst week since October 2008, during a global financial crisis. In just a few weeks, U.S. stocks have wiped out all the gains made during 2019, one of the best years for the
market in decades. All the major indexes are in what traders call a bear market.
On Friday, investors’ anticipation of a government stimulus effort and a rate cut by the Fed this week likely put traders in a buying mood, though it’s not unusual for stocks to rebound a day after a big decline.
Overall, the stock market selling has been so swift and sharp that there remains the potential for a significant bounce after the virus and its impact begin to recede, said Ryan Detrick, senior market strategist at LPL Financial. The economy was already on solid footing and well-known companies like Disney and Apple could help lead a recovery.
He also said there could be a recession on the horizon, but predicted that it would be mild. “It could be a shallow, quick, violent, scary recession, but one that bounces back quickly,” Detrick said.
Sadoff said he expects a V-shaped decline and then a quick rebound, once the coronavirus runs its course.
The question is how much damage is done to the economy on the way down, Sadoff said. That will determine how long it takes things to recover.
Here’s a look at the stock prices of some publicly-traded companies based in Wisconsin:
❚ Associated Bank. The Green Bay-based bank finished the day Friday at $13.84, up $1.03. For the week, Associated’s shares were down 11%.
❚ Johnson Controls. The company’s shares closed up 8.4% on Friday. For the week the shares closed down about 14%.
❚ Rockwell Automation. The Milwaukee-based company’s shares closed Friday at $166.18, up $16.59. For the week, its shares finished down about 7%.
❚ WEC Energy Group. The utility company’s shares closed Friday at $99.42, up $7.78. For the week, the shares were down 5%.
❚ Fiserv. The financial services processing company saw its shares rise nearly 9% on Friday. For the week, the shares were down about 3%.
❚ Kohl’s. The Menomonee Falls based retailer saw its shares rise nearly 8% on Friday. For the week, the company’s shares fell nearly 28.5%.
❚ Harley-Davidson. The Milwaukee-based maker of heavyweight motorcycles has been grappling with demographic trends that are prompting some of its best customers to age out of riding. Harley shares closed at $23.72 on Friday, up $3.36. For the week, Harley shares were down 9.4%.
❚ Manpower Group. The global staffing firm saw its shares rise more than 17% on Friday. For the week, Manpower Group’s shares were up 3%.
Rick Barrett, Guy Boulton and Sarah Hauer of the Journal Sentinel staff and the Associated Press contributed to this report.
Contact Joe Taschler at (414) 2242554 or jtaschler@gannett.com. Follow him on Twitter at @JoeTaschler or Facebook at facebook.com/ joe.taschler.1.