Thursday's Stock Market Open: US Equities Drop As Virus Fears Return To Rollercoaster Market

Update: 12:05 p.m. EDT:

U.S. stocks trade sharply lower as of noon on Thursday.

The Dow Jones Industrial Average dropped 671.04 points to 26,419.82 while the S&P 500 plunged 72.04 points to 3,058.08 and the Nasdaq Composite Index tumbled 164.55 points to 8,853.53.

In Europe markets finished lower as Britain’s FTSE-100 plunged 1.62%, France’s CAC-40 swooned 1.90% and Germany’s DAX tumbled 1.51%.

The yield on 10-year Treasury dropped to 0.927%

“The majority of this [decline] is just growing concern about the fallout from the virus because it’s spreading,” said Tom Essaye, founder of the Sevens Report. “For every hour, another group of people have it and it’s in another state. People are getting a bit nervous about this constant barrage of headlines.”

Sen. Elizabeth Warren dropped out of the 2020 presidential race.

The Commerce Department said on Thursday that factory goods orders decreased by 0.5% in January.

Original story:

U.S. stocks dropped on Thursday, one day after a massive rally, as traders assessed the potential impact of monetary policy and government intervention on the coronavirus crisis.

The Dow Jones Industrial Average dropped 659.36 points to 26,431.50 while the S&P 500 plunged 76.04 points to 3,054.08 and the Nasdaq Composite Index tumbled 211.45 points to 8,806.64.

The 10-year Treasury yield slipped to 0.941%.

The World Health Organization reported more than 95,200 confirmed cases of coronavirus around the world, with more than 3,270 deaths.

Iran, which has closed schools and universities until March 20, confirmed 3,513 cases and 107 deaths. Germany reported 349 cases, with about half in North Rhine-Westphalia. South Korea now has more than 6,000 infections. China’s finance ministries have allocated $16 billion for virus prevention and control.

California declared a state of emergency due to the virus.

The International Air Transport Association said the global air transport industry could lose up to $113 billion from the impact of coronavirus.

The Federal Reserve's emergency rate cut earlier in the week has been criticized.

“We’re nowhere near the sort of situation where the Fed should be acting like this,” said Richard Harris, chief executive at Port Shelter Investment Management on Thursday. “You have to wonder why [the Fed’s] acting like this and you have to wonder especially why they’re using their very, very sparse ammunition up -- a 50 basis point cut -- very early in a crisis.”

In the U.S., Initial jobless claims fell by 3,000 to 216,000 for the week ended Feb. 29.

The U.S. Bureau of Labor Statistics said on Thursday that unit labor costs rose 0.9% in the fourth quarter following an 1.4% increase in the third quarter. Nonfarm productivity rose 1.2% in the fourth quarter.

Overnight in Asia, markets finished higher as local government’s approved emergency spending.. China’s Shanghai Composite gained 1.99%, while Hong Kong’s Hang Seng jumped 2.08%, and Japan’s Nikkei-225 rose 1.09%.

In Europe markets dropped as Britain’s FTSE-100 plunged 2.14%, France’s CAC-40 swooned 2.42% and Germany’s DAX tumbled 2.24%.

Crude oil futures edged up 0.13% at $46.84 per barrel and Brent crude slipped 0.22% at $51.02. Gold futures gained 1%.

The euro rose 0.47% at $1.1187 while the pound sterling gained 0.33% at $1.2916.