U.S. stocks retreated Thursday as coronavirus-fueled swings around global markets continued over the potential economic fallout from the outbreak.
The Dow Jones industrial average dropped 700 points while the Standard & Poor’s 500 fell 2.4%. The technology-heavy Nasdaq Composite slid 2.1%.
The declines come a day after the Dow Jones industrial average rallied nearly 1,200 points, an about-face after shedding nearly 800 points on Monday. Health care stocks jumped Tuesday after former Vice President Joe Biden solidified his contender status for the Democratic presidential nomination. Investors see him as more business-friendly than Senator Bernie Sanders.
Concerns about the coronavirus disrupting global economic growth continued to weigh on investors this week as countries around the world extended travel restrictions. Investors expect other central banks will follow up on the Federal Reserve’s surprise move Tuesday of slashing interest rates by half a percentage point in hopes of protecting the economy from the economic fallout of the new coronavirus.
“We expect markets to remain volatile,” Mark Haefele, chief investment officer at UBS Global Wealth Management, said in a note. “The unfolding nature of the coronavirus threat—both real and perceived—is not yet quantifiable, and, as such, the current global policy response can’t immediately be judged as sufficient or insufficient for restoring investor confidence in the short term.”
Bond investors continued to piled into safe-haven assets such as U.S. government bonds. The yield on the 10-year Treasury fell to 0.97%, down from 0.99% on Wednesday.
Global benchmarks rose in almost every market overnight. France’s CAC 40 added 0.5%, while Germany’s DAX was up nearly 0.6%. Britain’s FTSE 100 inched up 0.2% to 6,830.92.
In Asia, Japan’s benchmark Nikkei 225 rose 1.1%. Hong Kong’s Hang Seng added 2.1%, while the Shanghai Composite jumped 2.0%.
Contributing: The Associated Press.