US Stock Market Overview – Stocks Decline, Led by Energy; Amazon and Netflix buck the Trend

US stocks fell on Wednesday but continued to diverge as the theme of purchasing companies that should outperform during the crisis continued. All sectors in the S&P 500 index were lower, led down by Real-estate and Energy, healthcare was the best performing sector in the S&P 500 index in a down tape. The US economy has tumbled into recession as large portions of the economy froze in March as the coronavirus pandemic closed malls, restaurants, concert halls, factories and mines, causing Americans to cut retail spending by a record. Retail sales tumbled and Industrial production dropped to a 74-year low. Oil prices pierced through the $20 per barrel level following a larger than expected build in total petroleum inventories. Gasoline demand according to the Energy Information Administration is down more than 31% year over year.

While the broader markets headed lower, there were some stocks that continued to outperform. Amazon hit a fresh all-time high, and so did Netflix. Both companies are expected to outperform during the COVID-19 self induced recession.

Retail Sales Tumble

US Retail sales drop by 8.7% in March, the biggest month-over-month decline since the records began in 1992, according to the Commerce Department. Sales at clothing stores dropped by more than 50%, while spending on motor vehicles, furniture, electronics, and sporting goods fell by double digits. A record drop was only counter by a sign of activity at grocery and beverage stores, which saw sales grow by 25.6%.

Industrial Production Falls to a 74-year Low

The US Federal Reserve reported that Industrial production fell 5.4%, the largest decline since 1946. The decline was driven by a decline in manufacturing which was down 6.3%. The drop in manufacturing was a function of the 28% decline in auto production as plants shut down.