2008 Crisis vs. 2020 Coronavirus Comparison: How Did IBM Fare Compared With S&P 500?

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On Monday, the U.S. markets saw their biggest sell-off since the 2008 crisis with the S&P falling by 7.6%. There were 2 distinct factors behind the sharp decline: a continued increase in the number of novel Coronavirus cases outside China, and a collapse in crude oil prices with Saudi Arabia boosting production. Tech behemoth IBM (NYSE:IBM) saw its stock price decline by about 8% on Monday, mirroring the performance of the broader index. In this analysis, we compare the performance of IBM to the S&P 500 over the current crisis and the economic crisis of 2007-08 to take a look at where it could be headed.

View our detailed dashboard analysis 2007-08 vs. 2020 Crisis Comparison: How Did IBM Stock Fare Compared with S&P 500?

IBM Stock Vs. S&P 500 Over 2020 Coronavirus/Oil Price War Crisis

  • IBM stock declined by 17% since the WHO declared a global emergency on Jan 31 and was down by about 8% on Monday, February 9th alone.
  • The S&P 500 has declined by 17.5% since the WHO declared a global emergency on Jan 31 and declined by about 7.5% on Monday, February 9th.

IBM Stock vs. S&P 500 Performance 2007-08 Financial Crisis

  • IBM stock declined from levels of around $84 in October 2007 (pre-crisis peak) to levels of around $67 in March 2009 (as markets bottomed out) and rebounded strongly to levels of about $97 in early 2010.
  • IBM stock declined by as much as 21% between the market’s approximate pre-crisis peak to when the markets bottomed out. This was relatively better compared to the S&P which fell by as much as 50%.
  • However, IBM stock rebounded quite strongly, rising by over 44% between March 2009 and January 2010. In comparison, the S&P 500 rose by about 48%.

For the timeline of the 2007-8 crisis and more detailed charts, view our dashboard analysis 2007-08 vs. 2020 Crisis Comparison: How Did IBM Stock Fare Compared with S&P 500?

Conclusion

  • Overall, IBM stock has been slightly less sensitive to the current crisis compared to the broader S&P 500, as was the case in 2008.
  • However, going by the trends of 2008, there is a possibility that it could emerge stronger compared to the broader market as the crisis winds down.

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