Bloomberg
Published Mar 12, 2020 22:18
Updated Mar 12, 2020 22:45
Stocks Tumble With Virus Responses Missing Marks: Markets Wrap
(Bloomberg) --
The rout in global stocks deepened as investors showed a lack of faith in the U.S. and European policy responses to the worsening spread of the coronavirus. Treasuries and the dollar surged.
The S&P 500 Index plunged as much 8.5% before paring the drop somewhat, with trading settling into a range after an initial bout of selling triggered a 15-minute NYSE-mandated halt. Trading will stop again if losses reach 13% any time before 3:25 p.m. European stocks tumbled 10% in the biggest intraday rout on record. The 10-year Treasury yield slid below 0.7%. Oil tumbled back toward $30 a barrel. Gold sank.
President Donald Trump’s travel ban and tepid fiscal measures sparked the latest leg down in risk assets, while the European Central Bank failed to stem the rout after it left rates unchanged, though it temporarily increased its QE program and took steps to boost liquidity.
“At this stage people are panicking,” said Chris Rupkey, chief financial economist for MUFG Union Bank. “The other shoe keeps dropping in a way we can’t foresee.”
On another bruising day across markets:
The World Health Organization earlier called the outbreak a pandemic and other countries, such as the U.K., have taken more extreme measures to try to blunt the threat to growth.
“Market moves suggest monetary stimulus has reached its limits,” said Lucas Bouwhuis, a portfolio manager at Achmea Investment. “Most of the stimulus needs to come from the fiscal side and we are just not seeing enough of that yet.”
Meanwhile, signs that companies in the hardest-hit industries were drawing down credit lines to battle the effects of the virus on their businesses added to anxiety.
“The risks have definitely risen,” said Chris Gaffney, president of world markets at TIAA. “The question is how long will this last and I don’t think anybody can predict that at this point.”
These are the main moves in markets:
Stocks
Written By: Bloomberg
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