Stocks Fall to Virus Selloff Lows
The Dow Jones Industrials crumbled 2,063.63 points, or 8.3%, to 21,489.59, due to a 15-minute “circuit breaker,” which temporarily halts trading at the New York Stock Exchange and NASDAQ.
The broader S&P 500 backed down 217.09 points, or 7.9%, to 2,524.29, to join the Dow in bear market territory.
The NASDAQ dumped 613.74 points, or 7.7%, to 7,338.31.
On Wednesday, the Dow ended its historic 11-year bull market run by closing in bear-market territory. A bear market marks a 20% decline from all-time highs. The S&P 500 was just shy of that threshold going into Thursday’s trading and was poised to enter bear market territory based on futures losses.
Before the open, futures contracts tied to the major indexes fell to their so-called limit down thresholds, sliding 5%. These limit down levels act as a floor for selling until regular trading begins.
Cruise line shares dropped sharply. Royal Caribbean traded 26.6% lower while Carnival dropped 19% and Norwegian Cruise Line slid 27.6%. Airline shares such as United, Delta and American all fell more than 12%.
In his address, Trump announced travel from Europe will be suspended for 30 days as part of the government’s response to the coronavirus outbreak. Trump also said the administration would provide financial relief for workers who are ill, caring for others due to the virus or are quarantined.
These moves were not specific enough for investors, however, who were looking for a more robust fiscal response to curb potentially slower economic growth stemming from the coronavirus.
Also causing concern about how pervasive the virus could already be in this country was the announcement Wednesday that the National Basketball Association is suspending its season after a Utah Jazz player tested positive for coronavirus. Movie actor Tom Hanks and his wife, Rita Wilson, also said they tested positive for the coronavirus.
Prices for the 10-Year U.S. Treasury gained ground, lowering yields to 0.78% from Wednesday’s 0.85%. Treasury prices and yields move in opposite directions.
Oil prices fell $1.52 to $31.46 U.S. a barrel. Gold prices skidded $68.70 to $1,573.60 U.S. an ounce.