Dow closes below 20,000 for the first time in over three years

The Dow closed below the 20,000 mark for the first time in more than three years amid widening alarm on Wall Street over the coronavirus.

The Dow Jones industrial average closed at 19,898.92, off 1,338.46 points, or 6.3 percent, as investors looking to raise cash liquidated nearly everything they could, including safe-haven assets like gold and government-issued Treasury bonds — a selloff not seen since the depths of the 2008 financial crisis.

As losses accelerated in the afternoon, the Dow had briefly plunged more than 2,300 points and well below 19,827.25 — the place where it closed on Jan. 20, 2017, the day Trump was sworn into office.

That’s despite the White House’s continued efforts to keep the coronavirus from kneecapping the economy. On Wednesday, Treasury Secretary Steven Mnuchin asked Congress to give it the authority to temporarily backstop money markets, which have been gyrating as investors braced for the prospect of a prolonged recession as industries from airlines to hotels and restaurants asked for federal handouts.

A similar tumble in the S&P 500 had triggered a marketwide circuit breaker on Wednesday for the fourth time in less than two weeks. The benchmark index recovered some of its earlier losses to close at 2,398.10, off 5.2 percent. The Nasdaq lost 4.7 percent to close at 6,989.84.

All three indexes have now slid more than 25 percent from their February highs.

Stocks had surged Tuesday as the Trump administration pushed for a coronavirus spending package that could grow to more than $1 trillion. But those hopes appeared to fade Wednesday as the number of cases worldwide surpassed 200,000 and millions of people remained shut in their homes.

“The greatest market ever is gone,” said Donald Selkin, chief market strategist at Newbridge Securities. “This shows that maybe there’s a lack of confidence in what the administration has done. They need much more.”

Source: Read Full Article