Dow plunges 969 points as coronavirus fears return

Another day, another gut-wrenching swing in stocks.

The Dow Jones industrial average tumbled nearly 1,000 points on Thursday — a day after surging more than 1,000 points — as fears about the spread of the coronavirus once again gripped Wall Street.

The blue-chip index sank as much as 1,033.45 points, or 3.8 percent, as new coronavirus cases popped up in New York, airliners warned of plummeting revenues and yet another Carnival cruise ship got barred from returning to port after passengers fell ill.

The Dow finished the day down 969.17 points, or 3.6 percent, at 26,121.69. The S&P 500 and Nasdaq lost 3.4 percent and 3.1 percent, respectively.

As investors fled to the relative safety of bonds, the yield on the benchmark 10-year US Treasury note fell to a record low of 0.904 percent. The tumble hit shares of banks, which relied on interest rates for profits. The rate on a 30-year fixed mortgage fell to a record low of 3.29 percent.

The plunge continued a week that has seen the market oscillate between huge gains and losses. On Wednesday, the Dow had surged nearly 1,200 points after Joe Biden scored several Democratic presidential primary victories and Congress struck a deal for $8 billion in funding to battle the coronavirus.

That came a day after the Dow dropped 786 points as the Federal Reserve failed to quell investors’ fears with an emergency interest rate cut. On Monday, the Dow had risen nearly 1,300 points, its biggest single-day point gain ever.

The roller-coaster ride is a typical response after a shock as big as the coronavirus-fueled panic that sent stocks into correction territory last week, according to Chris Rupkey, chief financial economist at MUFG Union Bank.

“It’s kind of like an earthquake — there’s the earthquake, which is last week, and then there’s the aftershocks, which is this week,” Rupkey said.

The selling continued Thursday after another flow of bad news about the outbreak. Eleven new coronavirus cases were reported across New York Thursday — including two in New York City — a day after California declared a state of emergency following its first death from the disease.

Meanwhile, the International Air Travel Association warned that the global passenger airline business could lose $113 billion in revenues this year if the virus spreads further — losses not seen since the dark days of the financial crisis. The S&P 500 airline index sank 8.2 percent, including a 13.4-percent drop for American Airlines.

Shares of cruise operators tumbled after the Grand Princess ocean liner, owned by Carnival Corp, was barred from returning to its home port of San Francisco on coronavirus fears after at least 20 people aboard fell ill. Carnival shares dropped 14.1 percent, while Royal Caribbean Cruises fell 16.3 percent.

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