CORONAVIRUS

Dow sinks as virus fallout continues

Dow down more than 300 points

#x201c;While the number of new cases of coronavirus continues to slow in China, the spread outside the country is escala
“While the number of new cases of coronavirus continues to slow in China, the spread outside the country is escalating and it seems the market is waking up to the impact on both individual companies and the wider economy,” says an investment director at AJ Bell. Above, a trader works on the floor of the New York Stock Exchange. (Associated Press)

U.S. stock markets slipped Friday as signs of the coronavirus’ chilling effect on the global economy continued to surface in earnings and manufacturing data.

The Dow Jones industrial average sank more than 300 points, or 1 percent, in early-afternoon trading.

The tech-heavy Nasdaq, which includes many China-exposed companies, was roughly 2 percent in the red. The Standard & Poor’s 500 index slid 1.2 percent.

Investor fears were reflected in gold’s extended rally, which powered the safe haven nearly 1.7 percent to a seven-year-high of $1,648.

Meanwhile, the yield on the 30-year Treasury fell to an all-time low, suggesting investors’ confidence in the economy has been shaken.

“While the number of new cases of coronavirus continues to slow in China, the spread outside the country is escalating and it seems the market is waking up to the impact on both individual companies and the wider economy,” Russ Mould, investment director at AJ Bell, wrote in commentary Friday.

“Profit warnings linked to the health crisis, as companies are either hit by slowing consumer demand in China or impact on their supply chain, are starting to trickle out with the impact on iPhone sales revealed by Apple earlier this week the most high profile of these.”

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The virus has killed more than 2,000 people worldwide and sickened more than 75,000, and the fallout has rippled around the globe through supply chain disruptions, cratering tourism and travel and widespread store closures that are challenging global firms and stalling growth at a time when it was expected to rebound thanks to the U.S.-China trade truce.

Experts now predict the global economy will shrink this quarter for the first time since 2009.

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