Worst quarter for stocks since 2008
THE stock market closed out a painful second quarter yesterday and left investors with heavy losses and far more doubts about the economy than they had just months ago.
Stocks had their worst quarterly performance since the financial crisis. The Standard & Poor’s 500 index, considered by many professional investors to be the best measure of the market’s health, lost 11.9 per cent, while the Dow Jones industrial average lost 10 per cent. Both indexes are at their lows for 2010.
Meanwhile, Treasury notes and bonds soared during the quarter, driving interest rates sharply lower, as investors turning away from stocks sought a place where their money would be safe. In the early days of the quarter, the yield on the Treasury’s 10-year note, used as a base for setting rates on consumer loans including mortgages, was close to four per cent. By the quarter’s end, it had fallen to 2.94 per cent.
On the last day of the April-June period, the Dow lost 96 points, and all the big indexes were down about one per cent.
Using the S&P 500 as a benchmark, stocks had their worst quarterly loss since the fourth quarter of 2008, when the index plunged 22.6 per cent. For the first half, the index is down 7.8 per cent, its worst first-half showing since the 13.8 per cent it loss at the start of 2002.
Meanwhile, trading saw the FTSE 100 index up by 2.65 points or 0.1 per cent yesterday. Weak mining and banking stocks weighed heavily on the index but a strong performance from AstraZeneca kept the index in the green as it closed at 4,916.87. This is 13.4 per cent lower than at the start of the second quarter.