U.S. Stocks Plunge Over Coronavirus and Economic Concerns

By Stefan J. Bos

(Worthy News) – U.S. President Donald Trump pledged a strong, swift economic recovery and coronavirus vaccine after the U.S. market had its worst finish in three months.

All major U.S. stock indexes plunged Thursday amid claims of an increase in coronavirus cases, coupled with grim predictions from the U.S. central bank, the Federal Reserve.

Amid the turmoil, the Federal Reserve warned of a slow recovery with unemployment at 9.3 percent by the end of 2020, and its Chair Jerome Powell cautioned that millions of Americans might never return to their jobs.

The Federal Reserve said it plans to keep the benchmark U.S. interest rate at zero, most likely through 2022.

That Fed’s warnings frustrated President Trump. “The Federal Reserve is wrong so often,” he wrote on social networking site Twitter. “I see the numbers also and do MUCH better than they do. We will have a very good Third Quarter, a great Fourth Quarter, and one of our best ever years in 2021,” he claimed.

These remarks failed to impress the market. At Wall Street in New York, the Dow Jones industrial average plunged 1,861 points, or 6.9 percent, to close at 25,128.17. The Standard & Poor’s 500 indexes sank 188 points, or 5.9 percent, to settle at 3,002.10. The Nasdaq Composite dropped 527 points, or 5.3 percent, to end the day at 9,492.73.

Analysts called it their worst session since March. It was in sharp contrast with the optimism earlier this week that had propelled the tech-heavy Nasdaq index above 10,000 for the first time and pushed the S&P 500 into positive territory for the year.

All 11 S&P stock sectors and every Dow component were reportedly in the red. Nervous investors unloaded shares in airlines, cruise lines, energy, and hotels. Those are businesses closely tied to a resurgent economy.

Analysts linked the market movement later to worry that these industries will return to profitability more slowly due to global concerns over the coronavirus outbreak.

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