Wall Street clobbered as crude plummets, virus crisis deepens
NEW YORK (Reuters) - Wall Street suffered its biggest one-day loss since the 2008 financial crisis on Monday and recession worries loomed large as tumbling oil prices and ongoing coronavirus fears prompted investor panic on the anniversary of the U.S. stock market’s longest-ever bull run. All three major U.S. stock averages plunged sharply at the opening bell, triggering trading halts put in place in the wake of 1987’s “Black Monday” crash. The Dow plummeted a record 2,000 points out of the starting gate on a day that marked the current bull market’s 11th year.
S&P 500 futures declined about 1% after the bell, briefly extending their loss to just over 20% from their record high on Feb. 19 and suggesting the bull market may have ended. Investors generally consider a drop of 20% from a recent high to signify a bear market, raising the expectations of a drawn out period of negative sentiment.
“There’s a lot of fear in the market and if the price of oil continues to move lower it’s an indication that a global recession is not far away,” said Peter Cardillo, chief market economist at Spartan Capital Securities in New York.
The CBOE Volatility index , a gauge of investor anxiety, touched its highest level since December 2008.
Benchmark 10-year U.S. Treasury yields briefly sank to 0.318%, a record low.
The sell-off began over the weekend when an oil supply pact between Saudi Arabia and Russia collapsed and both countries vowed to hike production amid weakening global demand due to the coronavirus and signs of an economic slowdown.
Oil prices registered their biggest one-day fall since the 1991 Gulf war, with Brent crude futures LCOc1 closing down 23.88% and front-month WTI falling 25.1%. That sent the S&P Energy index .SPNY sliding 20.1%, its largest one-day drop on record.
Global markets were already on edge as worldwide confirmed cases of COVID-19 surged past 110,000, causing widespread supply disruption and large-scale quarantine measures as governments scramble to contain the outbreak.
The Dow Jones Industrial Average .DJI fell 2,013.76 points, or 7.79%, to 23,851.02, the S&P 500 .SPX lost 225.81 points, or 7.60%, to 2,746.56 and the Nasdaq Composite .IXIC dropped 624.94 points, or 7.29%, to 7,950.68.
Madrid (ITNTV) The European Union will close its borders to all non-essential travel as it attempts to contain the ongoing spread of the coronavirus on the continent. "The less travel, the more we can contain the virus," European Commission President Ursula von der Leyen said Monday following a video conference between G7 leaders. She appeared confident that the European Council would sign off on the restriction in a Tuesday vote. The bloc's member states imposed aggressive measures on Monday, days after the World Health Organization (WHO) said Europe was at the epicenter of the pandemic. French President Emmanuel Macron declared "war" on the virus during a national address on Monday, banning all social events across the country -- including family gatherings. Macron said those who have gathered in public places in recent days have not been respecting previous measures to limit the outbreak's spread in France, which as of Monday had 5,380 con...
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Turkish citizens, especially those living in metropolises, have been abiding by the “social isolation” principles laid out by the government, Interior Minister Süleyman Soylu has said, adding that almost 80 percent of life “stopped” in Turkey . “Up until now, just our ministry issued 38 circulars, 17 of which concern the borders. Many high-level precautions have been taken. Right now, 80 percent of life stopped in Turkey,” Soylu said on March 26 in an interview with a private broadcaster. Soylu also provided updated figures for passenger traffic. He said that there is a 73 percent decline in inter-city bus services, adding that these services can also be suspended if needed. On intra-city traffic, Soylu said that there has been an 80 percent decline. This figure was 65 percent according to another interview the minister held on March 25. The government has four cruxes it predicates on when taking measures against the spread of the novel coronaviru...
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