Wall Street plunges on fears of coronavirus pandemic
26 February, 2020, 1:17 am
New York (Reuters) – The S&P 500 and the Dow Jones Industrial Average on Monday suffered their biggest one-day percentage losses in two years after a surge in coronavirus cases outside China fanned worries about the global economic impact of a potential pandemic.
Investors sold riskier assets and rushed to traditionally safer bets such as gold and U.S. Treasuries after countries including Iran, Italy and South Korea reported a rise in virus cases over the weekend even as China eased curbs with no new cases reported in Beijing and other cities.
The benchmark S&P 500, which represents over 44% of the market capitalization of all global equities, lost $927 billion of its value on Monday alone and $1.33 trillion since its closing high on Wednesday last week, according to S&P Dow Jones Indices senior analyst Howard Silverblatt.
The S&P and the blue-chip Dow turned negative for the year to date and the Dow dropped more than 1,000 points on the day for only the third time in its history.
The technology-heavy Nasdaq fell 3.71%, the biggest daily percentage drop of the three major averages.
“We’re not likely to make any progress higher until we have evidence the spread of the coronavirus is decelerating,” said Mark Luschini, chief investment strategist at Janney Montgomery Scott in Philadelphia.
The Dow Jones Industrial Average fell 1,031.61 points, or 3.56%, to 27,960.8, the S&P 500 lost 111.86 points, or 3.35%, to 3,225.89 and the Nasdaq Composite dropped 355.31 points, or 3.71%, to 9,221.28.All of the 11 major S&P sectors closed in the red, led by the energy sector’s 4.7% decline and followed by a 4.2% drop in technology stocks.
Apple Inc slid 4.8% as data showed sales of smartphones in China tumbled by more than a third in January.
China-exposed chipmakers fell, with the Philadelphia SE Semiconductor index dropping 4.8%, while concerns about growing travel curbs dragged the NYSE Arca Airline Index down 6%.
Of the S&P’s sectors, the defensive utilities, real estate and consumer staples indexes fell the least on the day.