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Dow drops as much as 997 points as coronavirus fears worsen

Dow drops as much as 997 points as coronavirus fears worsen

US stocks plummeted Monday as the deadly coronavirus spread outside China and world leaders warned that the outbreak could hamper global economic growth.

The Dow Jones Industrial Average plunged as much as 997.01 points, or 3.4 percent, to 27,995.37 after market opened as the virus’s death toll climbed above 2,500 in China and spates of cases emerged in countries such as Iran, Italy and South Korea.

The blue-chip index was recently trading down 846.17, or 2.9 percent, after losing 227.59 points in a Friday selloff.

The Nasdaq composite plunged as much as 410.58 points, or 4.2 percent, after the opening bell to trade at a low of 9,166.01. And the S&P 500 lost as many as 106.23 points, or 3.1 percent, to hit a low of 3,231.52.

“Fears of secondary infections proliferating outside of China have come home to roost, sending risk assets in a tailspin and a wave of refuge-seeking into safe-haven,” Tokyo-based Mizuho Bank said in a commentary.

Global shares also took big hits as investors appeared to rush to safe-haven assets. The FTSE MIB index in Italy — where the virus has infected more than 150 people and at least killed five — was off more than 5.5 percent as major indices in Paris and Germany each tumbled 4.2 percent.

Gold, meanwhile, spiked to a 7-year high of $1,680 an ounce while the 30-year US Treasury yield hit a record low of 1.855 percent, indicating high demand for government bonds.

A South Korean dealer works in front of monitors at the KEB Hana Bank in Seoul, South Korea.
A South Korean dealer works in front of monitors at the KEB Hana Bank in Seoul, South Korea.EPA

The selloff slammed major US airlines, with American and Delta shares plunging as much as 9.5 and 6.8 percent, respectively, as United Airlines fell as much as 5.5 percent.

Tech companies also took a hit — Apple stock opened 5 percent lower at $297.26, while shares in chipmaker Intel lost 4.2 percent to open at $61.61. Electric-car maker Tesla, which opened a factory in China last year, tumbled 6.8 percent to an opening of $839.00.

The stock declines came after the International Monetary Fund warned the Group of 20, a forum of the world’s 20 largest economies, that the coronavirus epidemic could cut global growth by 0.1 percentage points.

The outbreak has slammed manufacturing and business activity in China and could cause global oil demand to shrink for the first time in a decade, international leaders have warned.

“We will enhance global risk monitoring, including of the recent outbreak of COVID-19,” the G20’s finance leaders said in a statement, using the medical name for the disease caused by the coronavirus. “We stand ready to take further action to address these risks.”

With Post wires

Source : Noah Manskar Link