After opening to substantial gains, the Dow Jones suddenly plunged more than 250 points. Here's what catalyzed the stock market's nosedive.
After suffering three straight losses, the Dow Jones appeared determined to end the week on a high note.
The index rose more than 100 points when the market opened, but a sudden reversal tied to new developments in the coronavirus outbreak sent the Dow and entire U.S. stock market into decline.
The Dow’s fortunes reversed after the Centers for Disease Control and Prevention confirmed a second U.S. case of coronavirus.
Health officials maintain that the “risk to the U.S. public is low at this time” but revealed that they are currently monitoring 63 more potential cases.
More than 900 coronavirus cases have been confirmed in China, and CDC expects more U.S. patients to test positive in the coming days.
Reports indicate the next U.S. coronavirus patient may be identified even sooner:
The Dow Jones and broader stock market recoiled at the news, nosediving from their session highs to post moderate losses.
As of 12:08 pm ET, the Dow had fallen more than 250 points from its daily high. The index last traded at 29,035.43 for a net loss of 124.66 points or 0.43%.
The S&P 500 suffered the worst loss among Wall Street’s three primary indices, shedding 0.67% to slip to 3,303.3.
The Nasdaq split the difference, declining 0.58% to 9,347.92.
Panicky investors piled into safe-haven assets, and a resurgent gold price catapulted over the $1,570 level for a daily gain of 0.43%.
Treasury yields fell along with stock prices. The benchmark 10-year Treasury yield dove below 1.7% for the first time since October 2019 and last stood at 1.691%.
Oil prices extended their brutal decline because economists worry that the coronavirus outbreak could intensify China’s growth slowdown.
Already, containment efforts have put a severe damper on the country’s Lunar New Year festival, which accounted for just under $150 billion in consumer spending in 2019.
WTI crude futures slid 2.63% to $54.13, while Brent crude dropped 2.4% to $60.55.
This article was edited by Sam Bourgi.