This week we closed the books on not only March, but the first quarter of 2020. I don't need to tell you it was a challenging time given the global impact of the coronavirus. Major U.S. equity indexes were mixed in January, but as February wore on and the impact of the virus -- first in China and then in Italy and globally was felt -- those same indexes all moved lower. As the virus' impact not only worsened in Europe, its spread in the U.S. kicked up considerably in the back half of March, leading the economy to come to a standstill. There was also the Saudi Arabia-Russia oil price war that erupted and torpedoed oil prices alongside falling global demand.
In response, a growing number of companies late in the month shut doors, furloughed workers, idled production, pulled their 2020 guidance and in some cases shrank, postponed or eliminated dividends. This led to double-digits declines across the board for the major equity indexes in March. Combined with the performance of the first two months of 2020, it was one of the worst first quarters in history. For some perspective, the Dow lost 23.2% over the quarter, its worst first quarter in its 135-year existence and the biggest loss of any quarter since the fourth quarter of 1987.
By comparison, while the Real Money Post-Industrial Average (RMPIA) shed almost 6% in March, its first-quarter performance was a market-beating 11.2% dip. Normally, this isn't something to brag about, but given the environment, we'll take the relative win for March and the quarter. RMPIA is a modified market-cap weighted portfolio consisting of 30 of the most important stocks in the market today.
While RMPIA had its share of pain in the form of Booking Holdings (BKNG) and Starbucks (SBUX) shares that fell 34.5% and just over 25% for the March quarter, 18 RMPIA constituents outperformed the S&P 500. That includes the positive moves for the March quarter with Amazon (AMZN) , Gilead Sciences (GILD) , Netflix (NFLX) and Regeneron Pharma (REGN) shares.
With the hand off from the March quarter to the current one, we've started to see the impact of the virus in the economic data, and it isn't pretty. This week's weekly initial jobless claims catapulted higher to 6.648 million, nearly doubling expectations for a new record high of 3.5 million. This follows last week's record breaking 3.28 million new claims, which was also more than double the 1.5 million expected and 4.7-times higher than the prior record high. But it wasn't the only jobs-related gut punch we received this week. The latest Challenger Job Cuts report found that cuts rose to 222,288 in March from 56,660 in February -- the biggest one month increase since 2007. Combining these two reports with the job shedding news found in ADP's March Employment Report and the past two weeks of brutal initial jobless claims, the Friday payroll report for March is going to be ugly.
Adding to the mix, Wednesday's March ISM Manufacturing report saw a modest headline decline to 49.1 from the prior month's 50.1 reading. The March figure signals we are in contraction territory, which should come as little surprise given the idled production we've been hearing about in recent weeks. The bigger issue was the sharp fall in orders, which hit 42.2 vs. 49.8 in February. That signals we will see a steep drop in the April ISM Manufacturing Index.
The report also revealed the highest spread between the ISM Purchasing Managers' Index and the ISM PMI ex-supplier deliveries. What that means is that the economy is simultaneously experiencing very weak demand coupled with a huge negative supply shock and suppliers have also ramped down their production. This likely means there will be some pain felt when the virus begins to pass and the manufacturing ecosystem begins to turn back on. And, yes, the employment component of the March report also fell sharply month-over-month to 43.8 -- and the March employment report Friday didn't do much to improve the mood.
And even where there is some good news, it's offset by virus-related uncertainty. For example, this week Walgreens (WBA) reported better-than-expected top and bottom-line results for its latest quarter, but "given the many rapidly changing variables related to the pandemic," the company is not offering an updated outlook at this time. Rather, it will look to provide an update in its next quarterly earnings report. Similarly, branded apparel company PVH (PVH) reported quarterly results last night, beating expectations, but also did not offer investors a view on the coming quarters. PVH also joined the growing list of companies that suspended its dividend.
With the duration of the outbreak now expected to last several more weeks or longer, odds are high, we will see more companies punt on sharing an updated 2020 outlook until mid-year.
To me, this confirms the thoughts we shared earlier this week with subscribers of Stocks Under $10 and Trifecta Stocks that consensus earnings per share expectations are likely to move even lower than they already have for the first half of 2020. Between now and April 14, when the pace of March-quarter earnings reports begins to kick into gear, we expect the data picture will remain dire, and the number of companies extending furloughs and idling production to grow further as the virus continues to hammer the economy. We suspect this will keep investors on pins and needles, but our fear is those looking for some reprieve from the March quarter earnings season are likely to be disappointed.
If that view is correct, the positive is RMPIA and its constituents should continue to perform better hopefully on an absolute basis if not at least a relative one.