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Live updates: U.S. markets crater with stocks down more than 5 percent as coronavirus spreads - The Washington Post

The forced freeze was a sign of volatility for Wall Street amid the most turbulent trading in recent memory. Another 15-minute halt will be triggered if the S&P 500’s losses hit the 13 percent threshold. In the event of a 20 percent decline, markets would shut down for the day.

“The bull market’s 11-year birthday is today but investors are not in a celebratory mood with trading halted shortly after the open as markets plunged,” Greg McBride, chief financial analyst at Bankrate.com, wrote in commentary Monday. “The uncertain economic impact of coronavirus continues to grip markets, with stocks, commodities and interest rates all dropping sharply. Markets hate uncertainty and there is a ton of it currently in play.”

But the first-ever halt seemed to have a stabilizing effect, spurring a rebound in all U.S. indices. Less than an hour after the freeze, the Dow was down more than 1,380 points, or roughly 5.3 percent. The S&P 500 was also down 5.3 percent and the Nasdaq was 4.8 percent in the red.

Oil prices tumbled into the $30s, after Saudi Arabia and Russia deadlocked over production. The Saudis had been pushing for a cut in output to prop up prices, but did a reversal when Russia balked and decided, instead, to flood the market with hundreds of thousands of additional barrels per day at a steep discount — a move analysts fear may trigger a price war.

“Cheap oil is one thing. Super cheap oil is another,” said John Kilduff of Again Capital. “The stock market is looking at the oil price plunge as a canary in the coal mine of a disinflationary one-two punch, driven partly by cratering demand for transportation fuels and a wanton price war among the major oil producers” that will result in big losses for U.S. and Canadian producers.

Global markets were apoplectic. Japan’s Nikkei closed down more than 5 percent, while Hong Kong’s Hang Seng Index shed more than 4.2 percent. European markets were tumbling more than 7 percent across the board in midday trading.

Panic pushed the yield on the U.S. 10-year Treasury below 0.4 percent for the first time in history Monday as investors fled for safe havens. The trajectory could be an ominous sign of a weakening economy, because a low yield can indicate a lack of confidence in economic growth. Yields decline as bond prices rise. Gold, another safe haven, was up 0.4 percent in early trading.

Confirmed U.S. coronavirus cases surpassed 500 over the weekend, with cases in 30 states and the District of Columbia. Americans are beginning to face disruption to their work and travel, and the list of major events canceled in the face of the outbreak grows by the hour.

“The broader stock indexes … finally succumbed to the unraveling of an unbelievable period of excessive optimism on the part of the investing public and speculators,” said Steve Craig, chief energy analyst at Elliott Wave International, in an email. “It’s easy to blame the global selling panic on fears of a coronavirus pandemic, but it has more to do with the unwinding of excessive investor optimism than anything else.”

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https://news.google.com/__i/rss/rd/articles/CBMiT2h0dHBzOi8vd3d3Lndhc2hpbmd0b25wb3N0LmNvbS9idXNpbmVzcy8yMDIwLzAzLzA5L21hcmtldHMtZWNvbm9teS1jb3JvbmF2aXJ1cy_SAV5odHRwczovL3d3dy53YXNoaW5ndG9ucG9zdC5jb20vYnVzaW5lc3MvMjAyMC8wMy8wOS9tYXJrZXRzLWVjb25vbXktY29yb25hdmlydXMvP291dHB1dFR5cGU9YW1w?oc=5

2020-03-09 15:39:00Z
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