US stocks suffered their biggest one-week decline since the financial crisis in 2008, with the S&P 500 dropping more than 13 percent, and it looks like they will get off to a weak start this week.
US stock futures opened sharply lower on Sunday night, with the Dow Jones Industrial Average futures falling more than 900 points, or 5 percent, to hit their “limit down” level. S&P 500 and Nasdaq 100 futures were also down around 5 percent.
In the US, more than 30,000 cases have now been confirmed, with the number of cases in New York state having hit 15,168 over the weekend, more than in France or South Korea.
Indeed, Kelsey Piper and Christina Animashaun at Vox had suggested last week that the path of the COVID-19 outbreak in the US is following the same path as that in Italy, where the number of deaths from the virus has now hit 5,476, more than any other country in the world.
“[T]he US and most European countries are seeing early coronavirus growth numbers that look like the ones from Italy. Our confirmed cases are increasing at about the rate theirs did. That gives us every reason to think our health systems will eventually be overwhelmed like theirs were, unless we take strong measures sooner than they did,” they wrote.
A recession in the US is now widely expected, with Goldman Sachs in particular warning that the economy will decline at a 24 percent rate in the second quarter.
“Things will get worse before they get better and the markets will continue to reflect that reality,” said Marc Chaikin, CEO of Chaikin Analytics.
“This is an unprecedented situation, this is worse than 2008, this is worse than 1987, this is the worst crisis to hit financial markets since the Great Depression,” said Stephen Isaacs, chairman of Alvine Capital Management’s investment committee.
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