Wall Street sinks again as virus response falls short

The floor of the the New York Stock Exchange (NYSE) is seen after the close of trading in New York
The floor of the the New York Stock Exchange (NYSE) is seen after the close of trading in New York, U.S., March 18, 2020. (REUTERS/Lucas Jackson)


 The S&P 500 was on course to sink close to three-year lows at open on Thursday, as another round of sweeping emergency action from policymakers across the globe failed to convince panic-stricken stock markets that a global recession could be averted.

Investors again sold travel and leisure stocks furiously. American Airlines secured another $1 billion in bank credit to help its fight against the crisis, but still saw its shares fall another 4% in response.

The airlines index <.SPCOMAIR> is down nearly 60% this quarter as major cities around the globe enter a virtual lockdown, emptying hotels and airports and forcing automakers to shutter plants.

Hotel operator Marriott International Inc <MAR.O> and Darden Restaurants <DRI.N> both dropped more than 10% in premarket after pulling their 2020 financial outlook.

Moves on Wednesday by the Federal Reserve and European Central Bank to pump hundreds of billions of additional euros and dollars into the financial system gave markets an early lift in Europe.

But the optimism was short lived as more companies flagged a hit to business from the pandemic.

“The fact that we have coordinated stimulus response by governments, both monetary and fiscal policy is certainly seen as a positive step,” said Art Hogan, chief market strategist at National Securities in New York.

“The problem is we need to see numbers actually peak before we know that the healthcare response, is appropriate.”

Wall Street’s worst selloff since the 2008 sub-prime crisis has continued to deepen this week and the Dow erased the last of its gains under President Donald Trump’s presidency on Wednesday.

In corporate America, Accenture Plc <ACN.N> cut its full-year revenue and earnings outlook, citing an impact from the coronavirus outbreak.

Official data showed the number of Americans filing for unemployment benefits surged to highest since 2017 last week in the first indication of the outbreak’s toll on employment.

Adding to worries, New York Stock Exchange-owner Intercontinental Exchange Inc <ICE.N> said the market would temporarily close its trading floors and move fully to electronic trading starting next week.

Wall Street’s three main indexes are now down roughly 30% from record closing highs last month.

At 8:20 a.m. ET, Dow e-minis <1YMcv1> were down 532 points, or 2.66% and S&P 500 e-minis <EScv1> were down 65.75 points, or 2.74%. The Nasdaq 100 e-minis <NQcv1> were down 138.5 points, or 1.92%.