The stock market rout last week over fears the coronavirus could trigger a recession was the worst since the 2008 financial crisis, but market experts said on Monday trade was mostly orderly thanks to a robust market infrastructure.
On the retail side, TD Ameritrade said trading volume last week by its 11 million clients was 1.5 times higher than earlier in February, with above-normal activity registered on both the buying and selling sides: “People may not have liked what happened, but the way in which it happened was actually pretty impressive,” said JJ Kinahan, chief market strategist at the online brokerage.
Robinhood, the free trading app popular with young investors, experienced a system-wide outage on Monday as stock prices rebounded. Various media outlets reported outrage from the apps users.
The US markets are highly automated, with millions of messages processed each second, and much of last week’s move was likely computer-driven, led by professional traders, said Ben Carlson, director of institutional asset management at Ritholtz Wealth Management. He said he did not notice any major flash crash-type price spikes or major discrepancies between exchange-traded fund prices and the prices of their underlying constituents.