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The SP 500 fell more than 7 percent at the open on Thursday after WHO declared COVID-19 a pandemic and U.S. President Donald Trump imposed a travel ban for Europe, triggering this week's second circuit breaker for another 15-minute halt.
At 10:02 a.m. ET, the Dow Jones Industrial Average was down 1,867.08 points, or 7.93 percent, at 21,686.14, while the SP 500 was down 188.00 points, or 6.86 percent, at 2,553.38. The Nasdaq Composite was down 515.77 points, or 6.49 percent, at 7,436.28.
The World Health Organization declared the coronavirus outbreak a pandemic on Wednesday.
"In the past two weeks the number of cases outside China has increased 13-fold and the number of affected countries has tripled," WHO Director-General Dr. Tedros Adhanom Ghebreyesus said in Geneva on Wednesday. "In the days and weeks ahead, we expect to see the number of cases, the number of deaths and the number of affected countries to climb even higher."
Later, Trump suspended travel from Europe to the United States for 30 days, sending a shockwave through financial markets that pushed U.S. stock markets into bear market territory.
The SP 1500 airlines index plunged 10.1 percent with cruise liners Carnival Corp and Royal Caribbean Cruises Ltd. shedding 17 percent and 24 percent, respectively.
Boeing slumped another 15 percent after J. P. Morgan cut its long-term "overweight" rating on the planemaker's shares. The stock, already under pressure from the grounded 737 MAX jets, has lost more than 40 percent this year on the added hit from the virus outbreak.
American Airlines and United Airlines plummeted over 13 percent.
"It's not just the fear of the economy going weak, but basically being on the brink of shutting down," said Dennis Dick, proprietary trader at Bright Trading LLC in Las Vegas.
"It's mass selling across the board (and) we are pricing in a potential to go into another financial crisis."
European shares also plummetedto their lowest in almost four years on Thursday. The benchmark STOXX Europe 600 Index fell 6.3 percent, extending declines to a sixth straight day.
Air France KLM, Lufthansa and British Airways-owner IAG declined between 11.4 percent and 13.5 percent.
Oil prices were also hammered, with both main contracts falling around six percent. The oil market was already under pressure after Saudi Arabia and Gulf partner UAE stepped up a price war with plans to flood the global markets.
The SP 500 on Monday triggered an automatic 15-minute pause in trading for the first time since the 2008 financial crisis, with the 10-year U.S. Treasury yield tumbling down through 0.5 percent to a record low.
The COVID-19 outbreak, first reported in the city of Wuhan, central China's Hubei Province, last year has already claimed the lives of more than 4,300 people worldwide, with over 110,000 cases confirmed as of Wednesday.
(REUTERS&CGTN)
