Nation & World

Dow average sinks into bear market

Uncertainty over coronavirus continues to worry investors

Traders on the floor of the New York Stock Exchange on Wednesday saw stocks close sharply lower, erasing more than 1,400
Traders on the floor of the New York Stock Exchange on Wednesday saw stocks close sharply lower, erasing more than 1,400 points from the Dow industrials. (Associated Press)

Stocks plunged around the world Wednesday, oil tumbled and the stress in U.S. credit markets deepened after the World Health Organization called the coronavirus spread a pandemic.

The latest bout of virus-fomented turmoil tipped Dow Jones Industrial Average into a bear market, ending the longest bull run in the history of American equities.

The blue-chip slumped 5.9 percent Wednesday and ended 20 percent below its February closing record. The S&P 500 dipped into bear territory before closing 19 percent below its high.

The WHO declaration rattled markets already on edge that the spreading virus will upend global growth. President Donald Trump was scheduled to make a statement at 8 p.m. Eastern Time Thursday.

European officials signaled a growing willingness to move soon to combat the virus’s effects on the region’s economy.

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 New York Stock Exchange said it will restrict access to its trading floor, the Wall Street Journal reported.

“We have no idea when the coronavirus, the spread, is going to subside. That uncertainty is going to continue to create a lot of volatility,” said David Spika, the president of GuideStone Capital Management.

“We have no idea how to model it, we have no idea what to expect from it.”

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All but 10 stocks in the S&P 500 retreated Wednesday, with every industry down at least 3.9 percent.

An index of consumer services providers that includes hotels, cruise operators, Starbucks and Chipotle plunged 8.3 percent.

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