- US stocks fell on Wednesday, erasing Tuesday's gains as the coronavirus pandemic continued to spur investor panic.
- The S&P 500 tumbled 7% around 1 p.m. ET, triggering a so-called circuit breaker, which halted market-wide trading for 15 minutes. Major indexes continued lower after resuming.
- The stoppage came after S&P 500 futures trading was halted overnight after hitting the so-called limit-down threshold.
- The sell-off reflects worry that emergency actions from the Federal Reserve and a stimulus package from the White House won't be enough to offset the economic harm of the coronavirus outbreak.
- Read more on Business Insider.
US stocks fell on Wednesday, wiping out Tuesday's gains as volatile trading continued to grip markets. The losses came amid concerns that increased stimulus measures from the White House and additional emergency actions by the Federal Reserve won't be enough to offset the economic harm of the coronavirus outbreak.
The Dow Jones industrial average fell as much as 2,300 points - or 11% - in intraday trading, erasing all gains since President Donald Trump's inauguration before paring some losses in the afternoon. The index closed down more than 6% at a roughly three-year low.
The S&P 500 continued to tumble, closing about 5% lower after breaching the 7% circuit breaker threshold around 1 p.m. ET. That triggered a 15-minute market-wide trading halt.
Here's where major US indexes stood as of the market close on Wednesday:
- S&P 500: 2,398.45, down 5.2%
- Dow Jones industrial average: 19,898.92, down 6.3% (1,338 points)
- Nasdaq composite: 6,989.84, down 4.7%
The losses show that investors continue to worry about the timing of stimulus measures from the White House to curb economic fallout due to the coronavirus pandemic. Trump laid out a potential $1 trillion plan on Tuesday but gave few further details in a press conference Wednesday.
Equity indexes also came under pressure as oil prices slipped to their lowest level in 18 years, dragging energy shares lower. The latest plunge came amid escalation of the global oil-price war by Saudi Arabia while the coronavirus outbreak weighs on demand.
"The short-lived gains in global equities of late show that investors remain skeptical about the huge swathes of support measures being rolled out around the world by central banks and governments," Han Tan, an analyst at FXTM, told Business Insider in an email.
Fear that the economy will fall into a global recession or worse is likely to continue until the coronavirus outbreak stabilizes, Tan said.
Stimulus efforts have given investors little confidence because right now, the market has "nothing to hold onto to steady it," Jeffrey Kleintop, chief global investment strategist for Charles Schwab told Business Insider in an interview.
Looking forward, Kleintop said there won't be positive economic data for a while. He also noted that companies can't give any credible guidance on earnings right now.
Even in the event of a rebound, the market is "it's unlikely to bottom until we see the peak in new virus cases, and don't know when that'll be," he said.
As consumers increasingly stay home and stock up to practice social distancing during the outbreak, there have been a few bright spots in stocks such as Walmart and Walgreens, which gained Wednesday.
But the gains might not be sustained once the virus runs its course, Mike Loewengart, managing director of investment strategy at E*trade told Business Insider in an email. Still, he said there is some hope for investors in the long run especially if the impact turns out to be less severe than anticipated.
"Cheap oil, low interest rates, and accommodative fiscal and monetary policy are conducive to gains down the road for investors that keep their cool and stay focused on the long-term," Loewengart said.
