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US: Dow ends 7.8% lower, joining global rout on virus fears
[NEW YORK] Major Wall Street indices finished down more than seven per cent on Monday following an ugly session sparked by an oil price crash and fears over the economic fallout from the coronavirus.
At the end of a day-long rout, the benchmark Dow Jones Industrial Average was at 23,851.02, a loss of more than 2,000 points or 7.8 per cent, making it the worst session since December 2008.
The broad-based S&P 500 slid 7.6 per cent to 2,746.56, while the tech-rich Nasdaq Composite Index tumbled 7.3 per cent to 7,950.68.
The dramatic sell-off followed gloomy sessions in Asia and Europe and came as economists slashed their forecasts and mulled over the prospects of a global recession as further signs of economic fallout emerged.
"The return to business as usual in China has been slower than we had expected, while the spread of the coronavirus and associated disruption elsewhere has broadened," said a note from Oxford Economics.
"A global recession may not yet be an inevitable consequence of the coronavirus outbreak, but even a modest surge in bad news could make it our baseline view."
The global death toll from the virus neared 4,000, while US health officials urged Americans most at risk to stock up on food and medicine as Italy sought to close off a vast area in the northern part of the country that includes the cities of Milan and Venice.
Stocks were in the red the entire session. Trading was halted for 15 minutes shortly after the market opened, triggered by a requirement to suspend activity after the S&P 500 lost seven percent.
Oil-linked shares were an especially terrible place for investors as US oil prices ended 25 per cent lower at US$31.13 a barrel after Saudi Arabia slashed prices on crude following failed Opec talks last week.
Exxon Mobil slumped 12.2 per cent, Occidental Petroleum 51.4 per cent and Halliburton 37.6 per cent.
Others with especially bad drops included Boeing, down 13.4 per cent, Caterpillar, down 14.3 per cent, JPMorgan Chase, down 13.5 per cent and chemical producer Dow, down 21.6 per cent.