Reality sets in: It’s not fake news or conspiracy

As the effects of the coronavirus emergency ripple across the state, the message has finally hit home.

NEW YORK » Stocks sank to their worst week since the financial crisis of 2008 as traders went into full retreat out of fear that the coronavirus will plunge the U.S. and other major economies into deep recessions.

The Dow industrials dropped more than 900 points, extending their weekly loss to 17%. The price of U.S. crude oil also took another nosedive as investors anticipate a sharp drop in demand for energy as manufacturing, travel and commerce grind nearly to a halt.

New York became the latest state to extend a mandate to nearly all workers stay home to limit the spread of the virus. The action taken by New York Gov. Andrew Cuomo, coming just a day after California announced similar measures, is another sign that large swaths of the U.S. economy are coming to a standstill as restaurants, retailers and other businesses dependent on consumer traffic are forced to close doors and furlough or lay off workers.

The measures mean less demand for oil. U.S. crude dropped about 21% and moved below $20 a barrel for first time since February 2002.

The stock sell-off wiped out the market’s gains from a day earlier, deepening the losses in what’s been another brutal week on Wall Street. The Dow is down 16% for the week and has lost value in four of the last five weeks.

Investors are weighing the likelihood that the global economy is entering a recession because of the massive shutdowns and layoffs caused by the outbreak in spite of steps by central banks and governments to ease the economic pain.

Ultimately, investors say they need to see the number of new infections stop accelerating for the market’s volatile skid to ease.

“We just don’t know what the next two weeks will bring,” said Paul Christopher, global market strategist at the Wells Fargo Investment Institute. “Are we going to follow the same infection curve as other countries and the number infections will drastically accelerate? That’s when the storm is going to come.”

Investors continued to seek safety in U.S. government bonds, driving yields broadly lower. The 10-year Treasury yield, which influences interest rates on mortgages and other consumer loans, slid to 0.94% from 1.12% late Thursday.

Oil has been plunging recent weeks as investors anticipate a sharp drop in demand for energy as manufacturing, travel and commerce grind nearly to a halt. It’s down by nearly half from $45 a barrel earlier this month. A price war between Saudi Arabia and Russia has also pushed oil lower.

European and Asian markets closed broadly higher.

Despite the latest bout of selling, hopes remain that there will be progress in finding virus treatments and that “a boatload of stimulus by both central banks and governments will put the global economy in position for a U-shaped recovery,” said Edward Moya of Oanda in a report.

Members of President Donald Trump’s economic team were convening Friday on Capitol Hill to launch negotiations with Senate Republicans and Democrats racing to draft a $1 trillion-plus economic rescue package amid the coronavirus outbreak.

“We hope to see the Congress act on that early next week,” Vice President Mike Pence said during an afternoon press conference.

The rescue package is the biggest effort yet to shore up households and the U.S. economy as the pandemic and its nationwide shutdown hurtles the country toward a likely recession.