Despite the Fed’s emergency actions Sunday to drop interest rates to 0%, Wall Street plummeted Monday morning.
Markets opened with the S&P 500 down 8.14% (220 points), the Dow Jones opened down 2,250 points (9.71%), and the Nasdaq was down 6.12% (482 points).
Wall Street closed trading almost immediately after markets opened. The S&P 500 would have to drop 13% to halt markets again and a drop of 20% would stop trading for the day.
Markets closed Monday with the Dow falling 13% and nearly 3,000 points—the largest one-day collapse since 1987. The S&P 500 fell 12% to 2,386.13 to its lowest level since December 2018 and the Nasdaq recorded its worst day ever—falling 12.3%.
CNBC reported that mortgage rates are expected to fall again following Sunday’s announcement by the Fed.
“As was done during the QE phase of the Great Recession, the Fed purchasing MBS should help cushion some of the blow to Americans by potentially lowering their mortgage payment or giving them an incentive to buy a home,” said Dave Stevens, former CEO of the Mortgage Bankers Association and former commissioner of the FHA, to CNBC.
"The Committee expects to maintain this target range until it is confident that the economy has weathered recent events and is on track to achieve its maximum employment and price stability goals," said the Fed in a statement. 
Additionally, the Fed announced that over the coming months that it will increase its holdings of Treasury securities by at least $500 billion and its holdings and agency mortgage-backed securities by at least $200 billion.
Freddie Mac’s latest Primary Mortgage Market Survey revealed the average 30-year fixed-rate mortgage was 3.36% for the week ending on March 12. This is up from the prior week’s 3.29%.
Odeta Kushi, Deputy Chief Economist at First American, said the Fed's actions should help bolster the mortgage market and keep rates low.
“This echoes 2008 when the Fed’s mortgage-backed securities buying spree increased demand for mortgage-backed securities at a time when investor demand was faltering. This, in turn, helped push mortgage rates down, enabling homeowners to lower monthly payments and encouraging investment in housing," she said.
She added that actions by the Fed could cause mortgage rates to "flirt with 3%".
“Buying a home is the largest financial decision a person will make, and that is predicated on strong consumer confidence," Kushi said. "The Fed’s actions will lower mortgage rates and help existing homeowners save money through refinancing. Potential homeowners benefit from boosted purchasing power, which should drive increased competition and escalate house prices. But, you need to have both—buying power and confidence—to make the decision to buy a home.”
Tendayi Kapfidze, Cheif Economist at Lending Tree, said recent actions by the Fed "will have little effect" on the economy but will assist the recovery once COVID-19 subsides and activity return to normal.
"The Fed's goal appears to be to limit the damage to their financial markets during the period that social distancing will lead to widespread disruption to economic activity," Kapfidze said. "So far they are having little success as the markets focus their concerns on government response and the delay in a meaningful fiscal response."
He added that it is difficult to assess the impact that the rate cute will have on the economy as "the normal demand-stimulating nature of rate cuts, transmitted through financial markets," is disrupted by developments.
Kapfidze also noted that the Fed's decision to expand mortgage securities by $200 billion should "help narrow" the spread between mortgages and treasuries, though lender capacity constraints will still mean the transmission of the rate decline in mortgage borrowers will be optimal.