Tech firms hit hard in latest stock market drop

Dow enters bear market for first time since financial crisis

Tesla, Apple, Intel and other big Bay Area companies felt the ongoing effects of coronavirus on the stock market, Wednesday, as lack of progress on an economic stimulus plan led to another day of big declines on Wall Street.

All of the leading U.S. stock market gauges went into the red early and never came close to getting into positive territory during the day. The broad-based S&P 500 fell almost 5%, to end the day at 2,741.38, while the Nasdaq Composite Index also shed almost 5% and closed at 7,952.05.

And the Dow Jones Industrial Average, the world’s most closely watched barometer of the U.S. stock market, plunged by 1,464.94 points, or almost 5%, to finish at 23,553.22. Since reaching its all-time high of 29,568.57 in February, the Dow has fallen by 20%, meaning that blue chip market gauge has now entered bear market territory for the first time since the financial crisis of 2008.

A bear market begins when stocks have fallen 20 percent from their high.

President Donald Trump met Tuesday with Congressional leaders, but a lack of details and consensus on a plan to provide economic relief to consumers and businesses sent investors back into selling mode on Wednesday.

“As the contagion plays out in the coming weeks and months, it will increasingly impede business activity,” said James McDonald, chief executive and chief information officer of Los Angeles-based Hercules Investments. “The situation on the ground in the U.S. is likely to get worse before the epidemic blows over and will leave the economy worse off from it.”

Losses washed over local stocks, as Apple

shares fell 3.5%, to close at $275.43, Tesla ended the day down by 1.7%, at $634.23 a share, and Intel shares declined by 4.3%, to finish at $51.66.

Declines also came from Cisco Systems, down 7.6% to close at $37.05; Facebook, which was off by 4.5%, to finish at $170.24 a share; HP, which saw its shares slip by 2.2%, to $19.36, and Netflix, down almost 4%, to close at $349.92 a share..

The day’s market swoon continued an up-and-down trend for stocks this week that mirrored the latest reports about efforts to contain the spread of coronavirus and its ongoing impact on the U.S. and global economies.

Monday saw all the major stock market gauges fall by at least 7%, with the Dow Industrials losing more than 2,000 points. But, on Tuesday, the Dow climbed by 1,100 points amid hopes that an economic stimulus plan that would include a temporary payroll tax cut, would soon be put in place.

Adding to investors’ concerns was the World Health Organization declaring coronavirus to be a pandemic—meaning it is now classified as a new disease that has reached a worldwide

spread. So far, there have been 118,000 diagnosed cases of coronavirus around the world, and more than, 4,000 deaths from the disease during the current outbreak.