Dow tumbles almost 1,200 points, 124yr record, amid coronavirus scare

(NYPOST) – The Dow lost nearly 1,200 points — its worst single-day point drop in its 124-year history — as the worsening coronavirus outbreak stoked fears of a global slowdown.

The US stock market was plunged into correction territory Thursday amid persistent concerns about the coronavirus even after President Trump announced efforts to fight the outbreak.

The Dow Jones Industrial Average dropped 1,190.95 points to 25,766.64, plunging the blue-chip index well into correction territory after hitting an all-time high 29,568.57 earlier this month.

Thursday’s drop — which came on the heels of a three-day rout that shaved 2,000 points off the Dow — outstripped the previous one-day record of 1,175.21 points that was set Feb. 5, 2018. A market correction is defined as at least a 10 percent decrease from the recent peak.

The Nasdaq and S&P 500 also dropped 4.4 percent each after US health officials said the number of confirmed virus cases here had risen to 60 — including one in California that may have been contracted domestically.

Big swings during the day indicated investors were desperately searching for a bottom, even as they calculated risks that it could sink still lower if the coronavirus spreads further across the US, according to analysts.

“People are coming to grips with this virus,” said economist Gary Schilling. “This is going to tip the global economy into recession. It’s been brewing for months and no one knows where it stands. No one understands supply chains until one of the links breaks.”
“I sure don’t know where the bottom is here,” said Schilling. “But I think it’s a lot lower than where we are now.”

“I’m overall still bearish,” said Thomas Thornton of Hedge Fund Telemetry. “But six days to wipe out five months of gains is a bit too much too fast.”

The uncertainty about just how bad the crisis will get — and how hard it will hit companies — has also shaken traders, though corporate guidance in the coming weeks should help fill the information vacuum, observers said.

“Markets can deal with bad news. Dealing with uncertainty is much worse,” said Quincy Krosby, chief market strategist for Prudential Financial.

Trump tapped Vice President Mike Pence on Wednesday to spearhead American efforts to contain the virus, which he said poses a “very low” risk to Americans. But the US Centers for Disease Control and Prevention said it expected the disease to spread within the US.

The spread of the virus has raised concerns about the epidemic harming global growth. Former Federal Reserve chair Janet Yellen reportedly warned Wednesday that the outbreak could drive the US into a recession.

“If it doesn’t hit in a substantial way in the United States, that’s less likely,” Yellen said at an event in Michigan, according to Bloomberg News.

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