Stock market news live: Wall Street swoons as coronavirus fears escalate – Yahoo Finance

Stock News

Posted on February 24, 2020

Markets braced for more volatility on Monday, with investors unnerved by the growing possibility of a coronavirus pandemic. Last week, investors bolted risk-sensitive assets in favor of safe haven assets, including gold and Treasuries.

9:50 a.m. ET: Expect cheaper energy prices until 2025: BofA

The upside of the coronavirus crisis will be sharply lower energy prices, with the hit to global demand expected to keep crude depressed, according to Bank of America. In a research note to clients on Monday, analysts said they expect Brent to range-trade between $50 and $70 until 2025:

As prices become more anchored around $60, we believe volatility implied in oil options could trend lower in the medium term. In contrast to last year, we see more support to our price outlook on increased capital discipline across the US shale industry, despite coronavirus risks. Our projections assume OPEC+ is prepared to continue to lose share in the global oil market, particularly if pandemic risks rise again.

More broadly, we expect oil as a share of the global energy pie to will drop as well as the petroleum consumption mix keeps rotating away from gasoline and heavy ends into distillates and NGLs (natural gas liquids).

The bank also expects the oil market to need additional production cuts this year amid “modest” demand that will keep Brent averaging $62 per barrel in 2020.

—

9:30 a.m. ET: Wall Street plunges at the opening bell

The escalating coronavirus crisis is taking a huge toll on financial markets. The bloodletting that started on Sunday with stock futures and continued through Asia and European session has now hit U.S. blue-chip and tech stocks. Some of the day’s biggest losers include bellwether names like Apple, Google and Tesla — all of which fell by around 5% on the day.

Here’s where the markets began Monday’s trading session, which is shaping up to be an ugly one:

S&P 500 (^GSPC): -3% or -100 points to 3,237.52

Dow (^DJI): -3.2% or -918.19 points to 28,074.13
Nasdaq (^IXIC): -3.52% or -336.76 points to 9,245.73
Crude oil (CL=F): -4.72% to $50.86 a barrel
Gold (GC=F): +2.18% to $1,684.70 per ounce

Analysts, however, don’t think the current drop will last. Invesco’s Brian Levitt told Yahoo Finance on Monday that the current scare is little more than a blip in a longer secular bull that won’t trigger a recession. “We will be back sometime later in this year talking about stabilizing economic activity.”

—

7:30 a.m. ET: Stock futures slump in early trading

U.S. stock futures appeared poised to extend last week’s losses, with each of the three major indices indicating a lower open as Wall Street grappled with the widening coronavirus crisis.

Here’s were the main moves during the pre-market session, as of 7:30 a.m. ET:

S&P 500 futures (ES=F): 3,265.00, down 74.25 points or 2.22%
Dow futures (YM=F): 28,293, down 688.00 points or 2.37%
Nasdaq futures (NQ=F): 9,222.25, down 235.75 points or 2.49%
Crude oil (CL=F): $51.39 per barrel, down $1.99 or 3.73%
Gold (GC=F): $1,682.50 per ounce, up $33.70 or 2.04%

An unexpected surge in confirmed infections within South Korea and Italy — which now has the largest cluster of cases outside of China — raised the possibility that the mystery virus could be mutating into a pandemic. Last week, the Hubei province at the epicenter of the coronavirus outbreak revised its method of counting cases for the third time this month, further undermining confidence in the country’s official counts.

It raises the stakes for the entire global economy rather than just China, where the overwhelming majority of the world’s nearly 80,000 cases are located. According to Marc Chandler at Bannockburn Global Forex:

The [coronavirus] has not only crippled the Chinese economy, but its sheer size and magnitude of its integration in the global supply chains have far-reaching knock-on effects. Asia-Pacific economies that were increasingly reliant on Chinese input and demand are the most vulnerable. Estimates suggest that the world’s second-largest economy is operating well less than 50% of capacity.

Indeed, the extension of the stoppages and disruptions increase the likelihood that the Chinese economy contracts in Q1 [and] The supply chain disruptions are adversely impacting Japanese and Korean automakers. German automakers derived a substantial share of their profits from China, and car sales continue to weaken.

The virus is sending ripples across the global supply chain, with names like Volkswagen, Burberry, Starbucks and Apple among the growing list of multinationals whose operations are being adversely impacted by the outbreak.