The Atlanta Journal-Constitution
Markets fall again
Fear of the coronavirus outbreak returned to Wall Street on Thursday, with stocks and government bond yields tumbling as investors were confronted with more signs of how the spreading illnesses could hurt the global economy.
Fear dominated financial markets again, and stocks fell sharply on worries about the fast-spreading virus outbreak. It’s the latest shudder in Wall Street’s most volatile week in more than eight years.
Major U.S. indexes lost roughly 3.5%, and Treasury yields touched more record lows in their latest yo-yo move. The slide nearly wiped out the surge stocks had ridden just a day earlier,
The situation
Stocks plunged Thursday, falling more than 3% for the fourth time in the past two weeks, as investors began to consider that the economic damage caused by the fast spreading coronavirus could be much worse than they had initially expected.
Market volatility continued for a fourth day this week, with the S&P 500 falling 3.4% Thursday to finish at 3,024. The index has gained or lost more than 3% six times in the past two weeks.
The Dow Jones Industrial Average closed at 26,121, down nearly 3.6%, and the Nasdaq lost 3.1%, closing at 8,739.
The drop on Wall Street was led by energy, financial and industrial stocks — all of which are susceptible to concerns about the economy. Each of those sectors fell about 3% on Thursday. Airlines were also particularly hard hit..
Forecasts revised
Worry about long-term growth also pushed the yield on 10-year U.S. Treasury notes to a new low of 0.9%. Because of their relative safety, government bonds are in high demand during bouts of panic over the economy.
Economists at the Institute for International Finance slashed their outlook for the global economy on Thursday, downgrading their 2020 forecast for the growth in the United States to 1.3%. The revisions could “conceivably” take global growth to 1%, the weakest since 2009, chief economist Robin Brooks said, and down from 2.6% last year.
The price of oil was also volatile, first rising and then falling, even as the Organization of Petroleum Exporting Countries proposed cutting production in response to slumping demand.
Companies feel effects
At Amazon’s headquarters in Seattle, a worker has tested positive for the virus. In a message to employees on Wednesday night, Amazon said it was recommending that all employees in the Seattle region work from home this month if their jobs can be done remotely.
Facebook said on Wednesday that a contractor working in the company’s Seattle offices had tested positive for the virus, making it the second major tech company in the city to be affected by the outbreak.
On Thursday, HSBC, one of the world’s largest financial firms, said that an employee at its global headquarters in London had received a coronavirus diagnosis.
Other companies are escalating their efforts to protect employees. Twitter, Ford and numerous others have banned all nonessential travel. Walmart said that its employees could travel internationally only for “business-critical trips.”