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Thursday, Jul 31, 2025

Wall Street drops more than 3 per cent on coronavirus fears, as travel shares take beating

Wall Street drops more than 3 per cent on coronavirus fears, as travel shares take beating

Plunge comes just a day after market rallied thanks to Joe Biden’s success in Super Tuesday primaries. CBOE Volatility index, Wall Street’s fear gauge, jumped 7.62 points to 39.61

US stocks tumbled on Thursday, with shares of banks and travel companies taking a beating, as a new wave of fear about the spread of the coronavirus and its economic impact gripped investors just one day after election results powered a rally.

The major indices fell over 3 per cent. On Wednesday the market tallied huge gains following moderate Joe Biden’s success in the Super Tuesday primaries for the Democratic presidential nomination.

The coronavirus has led to more than 3,300 deaths worldwide. In the United States, new cases of the vast-spreading virus were reported on Thursday around New York and in San Francisco.

In the latest developments, Alphabet’s Google joined other big tech firms in recommending employees in the Seattle area work from home.



“There’s no way to put a framework around this, there’s no way to model it, because you just don’t know,” said Carol Schleif, deputy chief investment officer at Abbot Downing in Minneapolis. “The market is clearly trading on emotion today and not fundamentals because they can’t peg where the fundamentals are.”

The Dow Jones Industrial Average fell 969.58 points, or 3.58 per cent, to 26,121.28, the S&P 500 lost 106.18 points, or 3.39 per cent, to 3,023.94 and the Nasdaq Composite dropped 279.49 points, or 3.1 per cent, to 8,738.60.

The benchmark S&P 500 ended down more than 10 per cent from its February 19 closing high, after last week logging its biggest weekly percentage decline since October 2008.

“People are trying to test out a bottom, trying to decide was last Friday the bottom, at least in the near term, for this move or is there more downside ahead,” said Sam Stovall, chief investment strategist at CFRA Research.

The financial sector dropped 4.9 per cent as the continued fall in Treasury yields weighed on rate-sensitive bank shares. The yield on the 10-year Treasury note fell to 0.91 per cent.

Shares of JPMorgan Chase dropped 4.9 per cent and Bank of America Corp slid 5.1 per cent.

All 11 major S&P 500 sectors ended negative, but defensive sectors, such as utilities and consumer staples, fell less than the overall market.



The CBOE Volatility index, Wall Street’s fear gauge, jumped 7.62 points to 39.61.

Shares of companies in the travel and leisure industry were punished. The S&P 500 airline index skidded 8.2 per cent, including a 13.4 per cent fall for American Airlines Group.

The coronavirus epidemic could rob passenger airlines of up to $113 billion in revenue this year, an industry body warned.

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 per cent, while Royal Caribbean Cruises fell 16.3 per cent.

Data showed that the number of Americans filing for unemployment benefits fell last week, suggesting the labour market was on solid footing despite the coronavirus outbreak, with investors casting an eye toward Friday’s US employment report for February.

Declining issues outnumbered advancing ones on the NYSE by a 5.90-to-1 ratio; on Nasdaq, a 4.76-to-1 ratio favoured decliners.

The S&P 500 posted eight new 52-week highs and 79 new lows; the Nasdaq Composite recorded 25 new highs and 357 new lows.

About 12 billion shares changed hands in US exchanges, above the 10.2 billion daily average over the last 20 sessions.

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