Financial

Dow plunges more than 2,000 points, biggest decline since 2008, as coronavirus fuels market turmoil

trader upset stock market crashReuters / Cheryl Ravelo-Gagalac

  • The S&P 500 plunged as much as 8% on Monday before closing 7.6% lower and notching its worst single-day drop in nearly 12 years
  • The benchmark index saw such sharp immediate selling at the open that market-wide trading was temporarily halted minutes after 9:30 a.m. ET.
  • The Dow Jones industrial average declined 2,014 points, or 7.8%, its biggest single-day loss since October 2008.
  • Equities pared some of the downturn throughout the morning before falling to intraday lows in the afternoon.
  • The decline came amid a raging global oil-price war and continued fallout from the coronavirus outbreak.
  • The rising death toll from the virus in the US prompted new fears of an economic slowdown. The virus has killed 21 people and infected more than 500 people throughout the US.
  • Watch major indexes update here.

The benchmark S&P 500 plummeted as much as 8% on Monday before closing 7.6% lower and notching its worst single-day drop in nearly 12 years. The index’s sharp losses at the open prompted the first marketwide trading halt since the depths of the financial crisis in December 2008.

The Dow Jones industrial average declined 2,014 points, or 7.8%, its biggest single-day loss since October 2008.

The losses came as an oil-price war and the escalating coronavirus outbreak hammered risk assets from all sides. Equities pared losses after the halt before resuming their downward spiral.

The three major US indexes declined as investors digested the weekend’s oil-market turmoil. The commodity tanked the most since 1991 on Monday morning after Saudi Arabia’s surprise price cuts kicked off a production war with Russia. The move followed Russia’s refusal on Friday to curb oil production and prop up the coronavirus-rattled market.

Concerns about the coronavirus outbreak continued to weigh on investors as cases increased in New York, California, and Florida, among other states, to more than 500 people. The US death toll stood at 21 people, and the recent surge in confirmed cases could stifle economic activity by weakening consumer spending behavior.

The coronavirus has so far killed nearly 3,900 people and infected more than 111,000 people.

Here’s where major US indexes stood as of Monday’s market close:

Read more: ‘Much worse than 2008’: An expert who foresaw the dot-com crash warns the stock market’s recent turmoil has kicked off another full-blown financial crisis

The negative open extended the stock-market sell-off into its third week. Equities tanked for seven days in a row to close out February as fears about the coronavirus outbreak’s economic toll caught up with stocks’ lofty valuations. Risk assets recovered in March’s first trading session before intense price swings saw the market close Friday having erased nearly all month-to-date gains.

Central banks around the world have issued emergency stimulus to counteract an economic hit caused by the outbreak. Though the Federal Reserve cut its benchmark interest rate by 50 basis points on March 3, Wall Street now expects the central bank to push its rate to 0% to further protect from a virus-fueled contraction.

Now read more markets coverage from Markets Insider and Business Insider:

Stocks are fresh off their most chaotic week since 2011. Here’s why the market is so confused about what’s next.

Cruise giant Carnival has seen its market value plunge by nearly 50% since the coronavirus outbreak started

Internal memos from 2 major Manhattan brokerages reveal their coronavirus precautions. One isn’t seeing an impact on open houses – yet.

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