The global market selloff that plunged U.S. stocks into a bear market continued at a furious pace Thursday, as investors absorbed news of a travel ban between the U.S. and Europe and fear over the impact of coronavirus continued.
The S&P 500 shed 7% shortly after the opening bell, plunging the index into bear market territory and triggering a 15-minute halt in trading. The drop marked the second time this week that a rarely-used circuit breaker was triggered.
After reopening, the S&P 500 was down 7.3%, while the Nasdaq Composite was down 6.9%, putting the tech-heavy index on track for a bear market as well. The Dow Jones Industrial Average dropped 1,869 points, or about 8%.
The steep drops Thursday morning followed a tumultuous session of futures trading. Futures tied to the Dow Jones Industrial Average dropped 5% before markets opened. Contracts linked to the S&P 500 and the Nasdaq also hit the 5% limit, halting trading for the second time this week.
European equities also fell, with the Stoxx Europe 600 shedding 7.8%, putting the pan-continental gauge on course for its worst one-day performance in over 32 years.
On Thursday evening, President Trump announced a 30-day ban on most travel from Europe to the U.S., triggering fresh speculation about the disruption to business operations.
“Markets simply don’t know what the next steps are in terms of the virus spread,” said Edward Park, deputy chief investment officer at Brooks Macdonald. “We will see a dip in global growth in Q1 and Q2 and all the fiscal stimulus out there can’t avoid that.”
The Cboe Volatility Index, a closely watched measure of turbulence in the U.S. equity market, rose to its highest since December 2008.