Wall Street plunged in a volatile trading session heading into the weekend, extending a steep selloff from last week as the fast-spreading
raised fears of a global recession.
The three main stock indexes pared losses and the
briefly turned positive on gains in technology stocks including Microsoft Corp and chipmakers Nvidia and Qualcomm.
Industrials slumped more than 1,000 points during the session and if the index closes below this level, it would be its fifth 1,000-point decline in history and the third this week.
As the world prepares for a likely pandemic, investors rushed to safe assets, deepening an inversion of the U.S. Treasury yield curve, a classic recession signal.
“The uncertainty hovering over the markets will only be alleviated when there is a sense that the worst is almost over,” said Quincy Krosby, chief market strategist at Prudential Financial Inc. “Until then it is ‘risk off’.”
The three indexes closed more than 10% below their recent record closing highs on Thursday and are on track for their worst week since the 2008 global financial crisis.
At 11:53 a.m. ET, the
was down 96.59 points, or 1.13%, at 8,469.89.
While the magnitude of the economic damage from the containment measures, which have crippled supply chains and hit business investment, remained unclear, analysts have sharply downgraded their outlook for growth and corporate earnings.
Traders are now pricing in an interest rate cut by the Federal Reserve as soon as next month, but many have expressed doubts about how this would mitigate the impact of the outbreak.
Among individual stocks, Mylan NV dropped 8.3% after the drugmaker cautioned a financial hit from the coronavirus outbreak and warned of drug shortages in case of continued spread of the virus.
Declining issues outnumbered advancers for a 5.50-to-1 ratio on the NYSE and for a 2.99-to-1 ratio on the Nasdaq.
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