Let’s see where investors are putting their money.

Markets update

We start again in Asia where the major indices are trading a bit higher.

In Europe, the new epicenter of the Covid-19 pandemic, it’s looking less rosy. Tech heavyweights S&P and ASML were both up more than 3% at the open, notable as hedge fund giant Bridgewater Associates has built a monster short position against these two, and a bunch of other European stocks. According to Bloomberg, Ray Dalio’s fund has gone all-in with a $14 billion bet against Europe. Two hours into the trading session, Europe had fallen into the red, as had Dutch chip-maker ASML.

Across the Atlantic, the U.S. futures are following Europe’s lead down, as I type. The Dow and S&P 500 look set to open flat after yesterday’s brutal sell-off.

Elsewhere, the dollar is up. Crude, after a strong start, is slipping again. And gold is down. Perhaps the most optimistic sign of the day is that investors are not flooding into bonds. The U.S. 10-year has ticked up to 0.80%, well off the worrisome lows it hit on Friday and early yesterday.

Let’s go back to equities. The Dow Industrials yesterday was down 2,997.10 points to close at 20,188.52. Last month we were talking about Dow 30,000. Now there’s the question of whether the index will fall to depths that will wipe out years of gains. If the Dow were to fall a further 362 points it would return to the level it was on January 20, 2017, inauguration day for President Trump.

Let’s put yesterday’s drop into historical perspectives.

***

Black Monday 2.0

This chart astonished me. We’ve had two sessions in the past week that were on par with the worst days of the crash of 1929. Yesterday set a couple of records, including biggest-ever point decline. The volatility far outpaces anything we saw during the 2008-2009 financial crisis.

Of course, there’s always opportunity amid such markets tumult. I’ll leave you with this thought from Frances Donald, managing director, chief economist, and head of macro strategy at Manulife Investment Management, who spoke to Erik Sherman at Fortune.

“When the market is so bad and you believe it’s only going to get worse and panic is running everywhere—when panic has peaked, that is a good time,” he said.

Have we reached that peak? Donald, for one, is not convinced we’re there yet. But that day will come. And we’ll be here to detail that moment.

Postscript

In college, my very first journalism job was on the obits desk. A few evenings a week, I wrote obituaries that ran in the pages of a family-owned newspaper in central New Jersey. This was back in the early 90s when local newspapers were a big deal in cities and towns across the country. No story was bigger, my editor told me, than the obit. Everybody reads them.

That’s probably why, wherever I travel, from Nairobi to New Jersey, I pick up the local newspaper and quickly head to the obits page.

I was startled to hear a radio interview this morning with an Italian journalist in Bergamo, one of the hardest coronavirus-hit regions up north. He mentioned that, since the start of the crisis, the obits now regularly run over 11 pages in the local newspaper there, up from a page or two. “We’re losing a generation,” the reporter said.

Sorry to leave you on such a pessimistic note. We’re into our second week of lockdowns here in Italy, and the official figures are still showing a pandemic on the rise. I imagine that not until we start to see those obit pages thin again will we be on more secure footing about the future.

Take care of yourselves, everyone. I’ll see you here tomorrow.

Bernhard Warner
@BernhardWarner
Bernhard.Warner@Fortune.com

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Today's reads

Out of ammo? Billionaire hedge fund investor Ray Dalio is skeptical of the Federal Reserve’s efforts to prop up the coronavirus-hit U.S. economy. The Bridgewater Associates founder fears that a “hard 0%” interest rate floor could prove counterproductive for many asset classes and will deprive the Fed and other central banks of the ammunition to take further action if needed, writes Fortune’s Rey Mashayekhi.

The buy-back folly. The stock market selloff has revealed the dark side of U.S. corporations buying back their own shares. Some buybacks touted as great deals look terrible today. In many cases, CEOs and boards should have known better, and returned those billions in dividends instead, argues Fortune’s Shawn Tully.

Boomerang CEOs. It’s common for companies in dire straits to bring back a former CEO for a second stint. The most famous example is Steve Jobs, who transformed Apple when he returned after 12 years away. But for second-time-around CEOs, success is more the exception than the rule, writes Ryan Derousseau in Fortune.

Market candy

Quote of the day.

“Young investors should pray for bear markets because it allows them to buy more shares at lower prices.”

That's the view of Ben Carlson, director of institutional asset management at Ritholtz Wealth Management, who says that, while today’s plunging share prices are scary for those approaching retirement, they offer an opportunity for young investors who have decades to save and invest.