The Dow lost almost 1,200 points, its worst drop in a single day in its 124-year history, as the coronavirus outbreak worsened fears of a global slowdown.
The US stock market UU. It sank Thursday into correction territory amid persistent concerns about the coronavirus, even after President Trump announced efforts to combat the outbreak.
The Dow Jones Industrial Average fell 1,190.95 points to 25,766.64, plunging the blue chip index into correction territory after reaching an all-time high of 29,568.57 earlier this month.
Thursday’s fall, which occurred after a three-day defeat that cut 2,000 Dow points, exceeded the previous one-day record of 1,175.21 points that was set on February 5, 2018. A market correction is defined as at least a 10 percent decrease from the recent peak.
The Nasdaq and the S&P 500 also fell 4.4 percent each after US health officials. UU. They said the number of virus cases confirmed here had increased to 60, including one in California that could have contracted in the country.
Large swings during the day indicated that investors were desperately looking for a fund, even when they calculated the risks that it could sink further if the coronavirus spreads further in the United States, according to analysts.
“People are facing this virus,” economist Gary Schilling said. “This is going to lead the world economy into a recession. It has been preparing for months and nobody knows where it is. No one understands supply chains until one of the links is broken. “
“I’m sure I don’t know where the fund is here,” said Schilling. “But I think it’s much lower than where we are now.”
“Overall, I’m still a bass player,” said Thomas Thornton of Hedge Fund Telemetry. “But six days to eliminate five months of profits is too fast.”
Uncertainty about how serious the crisis will be, and how difficult it will be for businesses, has also shaken traders, although corporate guidance in the coming weeks should help fill the information gap, observers said.
“Markets can deal with bad news. Dealing with uncertainty is much worse, “said Quincy Krosby, chief market strategist at Prudential Financial.
Trump called Vice President Mike Pence on Wednesday to lead US efforts to contain the virus, which he says poses a “very low” risk to Americans. But the US Centers for Disease Control and Prevention. UU. They said they expected the disease to spread within the US. UU.
The spread of the virus has raised concerns about the epidemic that harms global growth. Former Federal Reserve president Janet Yellen warned Wednesday that the outbreak could lead the United States into a recession.
“If it does not impact the United States substantially, it is less likely,” Yellen said at an event in Michigan, according to Bloomberg News.