· Dow drops 1,300 points, S&P 500 loses 5% as coronavirus market sell-off reaches new low
Stocks tumbled on Wednesday, reaching a new coronavirus crisis low as investors worried about the economic damage from the pandemic.
The Dow Jones Industrial Average dropped 1,338.46 points, or 6.3% to 19,898.92, marking its first close below 20,000 since February 2017. The Dow was down more than 2,300 points at the lows of the session. The S&P 500 dropped 5.2% to 2,398.10 and closed nearly 30% below a record set last month. The Nasdaq Composite slid 4.7% to 6,989.84. Virtually no market was safe from the selling wave, with crude prices having their third-worst decline on record.
Stocks came off their lows in the final minutes of trading after the Senate obtained the votes to pass a coronavirus relief plan to expand paid leave.
Echoing concerns of the about the mounting economic impact of the virus and whether the government is doing enough to combat it, billionaire investor Bill Ackman said the best remedy for the market downturn and the outbreak in the U.S. is for President Donald Trump to shut down the country.
Trading was briefly suspended after a “circuit breaker” was tripped up. A circuit breaker halts trading across the U.S. stock exchanges for 15 minutes and is meant to ensure orderly market behavior. Wednesday marked the fourth time in a week that a circuit breaker was triggered.
· Dow futures point to more than 500-point gain after ECB announces massive stimulus package
Futures contracts tied to the major U.S. stock indexes jumped Wednesday evening after the European Central Bank joined the Federal Reserve in announcing a massive stimulus plan to help combat the impact the coronavirus.
As of 7:41 p.m. ET, Dow Jones Industrial Average futures were 476 points higher, implying an opening jump of 579.08 points.
S&P 500 and Nasdaq futures also pointed to higher opens, though futures contracts trading can change rapidly overnight. The SDPR S&P 500 ETF rose about 3% in the after-hours session.
Futures swung higher after the ECB announced a new Pandemic Emergency Purchase Programme that will deploy €750 billion ($819 billion) to purchase securities to help support the European economy. The central bank said purchases will be conducted until the end of 2020 and include a variety of assets including government debt.
“The ECB will ensure that all sectors of the economy can benefit from supportive financing conditions that enable them to absorb this shock,” the central bank said in a release. “This applies equally to families, firms, banks and governments. The Governing Council will do everything necessary within its mandate.”
· European shares close 4% lower despite multi-billion dollar stimulus pledges; oil stocks down 10%
European markets sank Wednesday, despite Western governments promising to unleash billions of dollars to help businesses and citizens get through the coronavirus pandemic.
The pan-European Stoxx 600 closed down 4%, with oil and gas stocks plunging nearly 10% to lead losses as all sectors and major bourses slid deep into negative territory.
· South Korea stocks drop beyond 2% as coronavirus fears continue to grip markets
Stocks in Asia Pacific lost their earlier upward momentum in Thursday morning trade as fears over the economic impact of the coronavirus pandemic continued to weigh on investor sentiment.
Major markets in the region fell into negative territory, with South Korea’s Kospi leading losses as it dropped 2.99% while the Kosdaq index fell 1.71%.
In Australia, the S&P/ASX 200 was last down 0.39% after earlier jumping more than 2%. Jobs data released Thursday showed the seasonally adjusted unemployment rate for February at 5.1%.
The Nikkei 225 in Japan remained in positive territory as it traded 0.64% higher while the Topix index added 2.29%.
Overall, the MSCI Asia ex-Japan index traded 1.3% lower.
Developments surrounding the global coronavirus outbreak will continue to be watched on Thursday.
Reference: CNBC, Reuters
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