Market Down But Off Lows As Trading Resumes

UPDATED with trading resumed: The selling pressure on stocks continued but indexes are off their lows after trading resumed. It was halted for 15 minutes as the S&P fell 7% at the opening, triggering circuit breakers.

The DJIA is down 5.8% and the S&P 500 is down just under 5.7%. The indexes are having their worse day since December, 2008.

(Trading would have been automatically halted again if the S&P falls 13% and would stop for the day after a 20% fall.)

The move came after fears over the spreading coronavirus in the U.S and abroad. That sank international markets in Asia and Europe with the Nikkei index in Japan down more than 5% (is biggest daily drop since 2016) and the Stoxx Europe 600 index – a Euro-area index – down over 6%.

Oil prices collapsed over the weekend as major producers Saudi Arabia and Russia went into a price war over cuts in production, that further exacerbated tensions and uncertainties among investors. Investors piled into safe assets like gold and treasures went up.

The situation appeared so serious that the U.S. Federal Reserve announced an increase in short-term lending to money markets to make sure there continues to be liquidity in the financial system.

Social media and tech stocks were among the worst hit. Google, Facebook and Netflix fell more than 7% before trading was halted. Amazon is down 5.5%

Disney and Comcast were down a little over 5%.

Over the weekend, Italy began the largest attempt outside of China to isolate the virus, putting severe restrictions on movement in the north of the country involving over 15 million people in the provinces of Lombardy and Veneto, the economic engines of the country. The impact of the epidemic is increasing in France and Germany as well. And in the U.S. health authorities are discussing more aggressive plans to mitigate the spread if it keeps growing.