2020 March, 12, 09:28:21 PM

Dow Goes Off 10% For Coronavirus Fears For Its Worst Day Since The 1987 Market Crash

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The Dow Jones Industrial Average closed 2,352.60 points lower, or 9.99%, at 21,200.62. The index had its worst drop since the 1987 “Black Monday” market crash, when it collapsed by more than 22%.The S&P 500 plummeted 9.5% to 2,480.64, joining the Dow in a bear market. The S&P 500 also had its worst day since 1987. The Nasdaq Composite closed 9.4% lower at 7,201.80.

Dow losses

“The coronavirus is scary and people don’t know what to expect,” said Kathy Entwistle, senior vice president of wealth management at UBS. “It’s like the tsunami is coming. We know it’s going to hit any day and nobody knows what the outcome is going to be.”

The major averages got a brief respite during the trading day after the Fed announced it will ramp up its overnight funding operations to more than $500 billion on Thursday. It will then offer more repo operations totaling $1 trillion on Friday. The Fed also expanded the types of securities it would purchase with reserves. 

However, stocks quickly traded back towards their session lows as investors awaited more aggressive measures to support the economy and target the virus outbreak directly.

“These changes are being made to address highly unusual disruptions in Treasury financing markets associated with the coronavirus outbreak,” said the statement from the New York Federal Reserve, which conducts these operations on behalf of the Fed.

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