· Dow drops nearly 3,000 points, as coronavirus collapse continues; worst day since ’87
Stocks fell sharply Monday — with the Dow suffering its worst day since the “Black Monday” market crash in 1987 and its third-worst day ever — even after the Federal Reserve embarked on a massive monetary stimulus campaign to curb slower economic growth amid the coronavirus outbreak.
The Dow Jones Industrial Average closed 2,997.10 points lower, or 12.9%, at 20,188.52. The 30-stock Dow was briefly down more than 3,000 points in the final minutes of trading. The S&P 500 dropped 12% to 2,386.13— hitting its lowest level since December 2018 — while the Nasdaq Composite closed 12.3% lower at 6,904.59 in its worst day ever.
The major averages fell to their lows into the close after President Donald Trump said the worst of the outbreak could last until August. He also told reporters the U.S. “may be” heading into a recession.
Monday’s losses put the Dow down 31.7% from its all-time high and the S&P 500 and Nasdaq more than 29% below their records last month. The Dow fell to its lowest point since 2017.
The Dow’s drop was the worst decline since its “Black Monday” crash three decades ago when it fell more than 22%. The drop surpassed its 9.99% tumble last Thursday. It was also the Dow’s third-worst day ever; it dropped more than 13% in late 1929.
Trading was halted for 15 minutes shortly after the open as a then-8% drop on the S&P 500 triggered a so-called circuit breaker. It was the third time in the last week a circuit breaker was triggered. Those circuit breakers are imposed by the exchanges to maintain orderly market behavior.
While the central bank’s actions may help ease the functioning of markets, many investors said they would ultimately want to see coronavirus cases peaking and falling in the U.S. before it was safe to take on risk and buy equities again.
· Dow futures jump 700 points after Wall Street suffers worst day since 1987 market crash
Stock futures traded higher on Monday night after Wall Street suffered massive losses earlier in the day amid concerns over the economic blow from the coronavirus outbreak.
As of 9:13 p.m. ET Monday, Dow Jones Industrial Average futures rose by 709 points. S&P 500 and Nasdaq 100 futures were also higher.
Those moves came after President Donald Trump tweeted: “The United States will be powerfully supporting those industries, like Airlines and others, that are particularly affected by the Chinese Virus. We will be stronger than ever before!”
· European stocks close down 5%, airline stocks tank as EU proposes travel restrictions
European markets slid on Monday as much of the region went into shutdown mode to prevent the spread of the new coronavirus.
The pan-European Stoxx 600 provisionally closed 5.1% lower, off lows hit earlier in the session. Travel and leisure stocks plummeted around 10% to lead losses as all sectors and major bourses ended the day in the red.
Spain’s IBEX was around 8.3% in the red and Italy’s FTSE MIB was down over 6%. France’s CAC 40 provisionally ended 5.9% lower. Germany’s XETRA DAX closed 5.3% in the red as the U.K.’s FTSE 100 finished 4.7%lower.
Markets spent the day reacting to the shutdown taking place on the continent.
· Asia stocks seesaw after Dow sees worst drop since 1987; Philippines suspends trading
Stocks in Asia were mixed in Tuesday morning trade after shares on Wall Street plunged to their biggest day drop in more than three decades overnight, and Philippines shut its markets temporarily.
South Korea’s Kospi led losses among major markets in the region as it slipped 1.76% in morning trade while the Kosdaq index made a turnaround to trade 0.61% higher.
In Japan, the Nikkei 225 recovered from an earlier slip of more than 2% as it rose 1.01%. The Topix index also made a turnaround into positive territory, last trading 1.37% higher.
Meanwhile, stocks in Australia rose, with the S&P/ASX 200 last up 2.6% after plummeting nearly 10% on Monday.
Reference: CNBC, Reuters
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