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Market Update: Wed, Mar 11, 2020 | LPL Financial Research

Market Update: Wed, Mar 11, 2020 | LPL Financial Research

| March 11, 2020

Down again. The S&P 500 Index opened sharply lower this morning, on the heels of a huge 4.9% oversold bounce yesterday, the largest single-day gain since December 26, 2018. There are now more than 1,000 cases of COVID-19 in the US, with many major events being cancelled or delayed until the summer. Stocks were higher yesterday on hopes of a payroll tax reduction, but this morning fiscal stimulus expectations are dampened, as both Democrats and Republicans have pushed back against the proposal in favor of more targeted measures.

Bear market without a recession? With the S&P 500 recently down 19% from the previous all-time high, many are wondering if stocks were to fall into a bear market, does that mean a recession is around the corner? Historically, the worst bear markets do take place during a recession, but not all of them. For example, going back to World War II, we found there were six bear markets that didn’t see the economy fall into a recession. You can read more of our thoughts here.

What does a payroll tax cut really mean? The Trump administration is floating the idea of a payroll tax reduction as a way to combat the COVID-19 economic slowdown. We’ve had many questions come in about what this could look like and what it could mean. We did a special Payroll Q&A on the LPL Research blog yesterday and you can read our thoughts here.



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