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| Dow Jones plunges into bear market after coronavirus declared pandemic – business live | Dow Jones plunges into bear market after coronavirus declared pandemic – business live |
| (32 minutes later) | |
| Disappointment over lack of action in Washington hits shares as Bank of England cuts interest rates | Disappointment over lack of action in Washington hits shares as Bank of England cuts interest rates |
| Meanwhile in Europe...... | |
| Investors must feel like they’ve been chewed by a bear, given the scale of the sell-off in the last few weeks. | |
| Here’s some reaction to the Dow Jones’s lurch into a bear market tonight: | |
| Michael Corbat, the boss of Citi, has claimed that we’re not facing a financial crisis. | |
| Speaking at a meeting of bank bosses with Donald Trump at the White House, he insisted: | |
| Today’s rout underlines how concerned Wall Street is about Covid-19, especially now it has been declared a pandemic. | Today’s rout underlines how concerned Wall Street is about Covid-19, especially now it has been declared a pandemic. |
| US investors want to see strong, clear steps from their leaders -- as we saw in the UK today, with the government announcing a stimulus programme and the Bank of England cutting interest rates. | US investors want to see strong, clear steps from their leaders -- as we saw in the UK today, with the government announcing a stimulus programme and the Bank of England cutting interest rates. |
| The worry, though, is that Republicans and Democrats won’t agree what needs to happen. | The worry, though, is that Republicans and Democrats won’t agree what needs to happen. |
| Quincy Krosby, chief market strategist at Prudential Financial, told MarketWatch. | Quincy Krosby, chief market strategist at Prudential Financial, told MarketWatch. |
| She adds: | She adds: |
| Boeing had a shocking day, and was a key reason the Dow slumped into a bear market tonight. | Boeing had a shocking day, and was a key reason the Dow slumped into a bear market tonight. |
| The aircraft maker’s shares fell 18%, the worst performance on the index by some distance, after it announced it would fully tap a $13.8bn credit line, after suffering a jump in cancelled orders. | The aircraft maker’s shares fell 18%, the worst performance on the index by some distance, after it announced it would fully tap a $13.8bn credit line, after suffering a jump in cancelled orders. |
| Chemicals maker Dow Inc slumped 10%, as fears of a global downturn refuse to abate. | Chemicals maker Dow Inc slumped 10%, as fears of a global downturn refuse to abate. |
| Tech firms United Utilities (-9.9%) and Cisco (-7.5%) were also top fallers, along with American Express (-7.6%) and Procter & Gamble (-7.5%) - who will suffer if more Americans self-quarantine or simply shun the shops. | Tech firms United Utilities (-9.9%) and Cisco (-7.5%) were also top fallers, along with American Express (-7.6%) and Procter & Gamble (-7.5%) - who will suffer if more Americans self-quarantine or simply shun the shops. |
| The Dow has fallen to its lowest point since January 2019. | The Dow has fallen to its lowest point since January 2019. |
| That means more than a year of gains has been wiped out in under a month. | That means more than a year of gains has been wiped out in under a month. |
| NEWSFLASH: The Dow Jones industrial average has officially fallen into a bear market, ending an 11-year rally. | NEWSFLASH: The Dow Jones industrial average has officially fallen into a bear market, ending an 11-year rally. |
| The Dow has ended the day down 5.9%, after another day of heavy, anxious selling. | The Dow has ended the day down 5.9%, after another day of heavy, anxious selling. |
| More than 1,464 points were ripped off the benchmark index, as it subsided to 23,553.22 points. That means it’s over 20% below February’s high, ending a run that began in 2009. | More than 1,464 points were ripped off the benchmark index, as it subsided to 23,553.22 points. That means it’s over 20% below February’s high, ending a run that began in 2009. |
| The news that Donald Trump is giving a statement tonight could not drag shares higher, given the news that Covid-19 is now a pandemic. | The news that Donald Trump is giving a statement tonight could not drag shares higher, given the news that Covid-19 is now a pandemic. |
| Newsflash: There are reports that president Trump will give a statement tonight on the coronavirus crisis, addressing the measures Americans should take: | Newsflash: There are reports that president Trump will give a statement tonight on the coronavirus crisis, addressing the measures Americans should take: |
| Breaking: US president Donald Trump has vowed to use all the powers at his disposal to tackle the coronavirus, in a flurry of tweets: | Breaking: US president Donald Trump has vowed to use all the powers at his disposal to tackle the coronavirus, in a flurry of tweets: |
| America’s tech-focused Nasdaq index is also on the verge of a bear market tonight: | America’s tech-focused Nasdaq index is also on the verge of a bear market tonight: |
| Earlier today, Swiss bank UBS warned that global stock markets could fall another 20%, if Covid-19 becomes a full-blown pandemic. | Earlier today, Swiss bank UBS warned that global stock markets could fall another 20%, if Covid-19 becomes a full-blown pandemic. |
| They estimate that shares only have another 5% to fall in an ‘intermediate’ scenario, while they could rally if the virus is contained. | They estimate that shares only have another 5% to fall in an ‘intermediate’ scenario, while they could rally if the virus is contained. |
| Analyst Arend Kapteyn says: | Analyst Arend Kapteyn says: |
| So for equities, that means -5% and -20% losses in intermediate and pandemic scenarios, respectively. | So for equities, that means -5% and -20% losses in intermediate and pandemic scenarios, respectively. |
| More bad news for investors: the S&P 500 index is also heading into a bear market tonight. | More bad news for investors: the S&P 500 index is also heading into a bear market tonight. |
| Over in São Paulo, Brazil’s Bovespa Index has slumped by more than 10% today. | Over in São Paulo, Brazil’s Bovespa Index has slumped by more than 10% today. |
| This triggered a circuit breaker, forcing trading to suspended for 30 minutes. | This triggered a circuit breaker, forcing trading to suspended for 30 minutes. |
| The energy, consumer cyclical and mining sectors are leading the sell-off: | The energy, consumer cyclical and mining sectors are leading the sell-off: |
| With an hour’s trading to go, the Dow is sliding even further... down 6%, or 1504 points, at 23,513. | With an hour’s trading to go, the Dow is sliding even further... down 6%, or 1504 points, at 23,513. |
| That would certainly put the index into a bear market, if it closes there at 4pm New York time, or 8pm UK time. | That would certainly put the index into a bear market, if it closes there at 4pm New York time, or 8pm UK time. |
| Democratic politicians are working on their own stimulus package, according to US political news site The Hill. | Democratic politicians are working on their own stimulus package, according to US political news site The Hill. |
| Anything passed by the House (America’s lower chamber) would then go up to the Senate, which is controlled by the Republicans. | Anything passed by the House (America’s lower chamber) would then go up to the Senate, which is controlled by the Republicans. |
| However, there’s a problem.... both chambers are scheduled to hold a recess next week. So any economic relief legislation might not even reached Donald Trump’s desk until later in March. | However, there’s a problem.... both chambers are scheduled to hold a recess next week. So any economic relief legislation might not even reached Donald Trump’s desk until later in March. |
| U.S. Treasury Secretary Steven Mnuchin dampened hopes of a rapid, major stimulus package earlier today -- another reason shares are under pressure. | U.S. Treasury Secretary Steven Mnuchin dampened hopes of a rapid, major stimulus package earlier today -- another reason shares are under pressure. |
| Mnuchin told lawmakers on Capitol Hill that a major economic stimulus package wouldn’t get through Congress quickly. So, it makes sense to start with a smaller measure designed to help small businesses and workers grappling with the coronavirus outbreak. | Mnuchin told lawmakers on Capitol Hill that a major economic stimulus package wouldn’t get through Congress quickly. So, it makes sense to start with a smaller measure designed to help small businesses and workers grappling with the coronavirus outbreak. |
| Mnuchin told House Appropriations subcommittee hearing. | Mnuchin told House Appropriations subcommittee hearing. |
| Today’s slump has more than wiped out Tuesday’s gains, which followed Monday’s crash (the worst since 2008) | Today’s slump has more than wiped out Tuesday’s gains, which followed Monday’s crash (the worst since 2008) |
| Today’s rout on Wall Street is being driven by a handful of coronavirus fears. | Today’s rout on Wall Street is being driven by a handful of coronavirus fears. |
| 1) WHO’s decision to declare Covid-19 a pandemic is fuelling fears of a global recession | 1) WHO’s decision to declare Covid-19 a pandemic is fuelling fears of a global recession |
| 2) Doubts are building about whether the White House will deliver a stimulus package. Donald Trump’s pledge of a major package, including payroll tax cuts, seems illusive. | 2) Doubts are building about whether the White House will deliver a stimulus package. Donald Trump’s pledge of a major package, including payroll tax cuts, seems illusive. |
| AFP explains: | AFP explains: |