Dow Plunges By Over 1,000 Points As Coronavirus Sparks Third Worst Daily Point Loss Ever

Jill Goldsmith

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UPDATED with closing indexes, stock details:

Wall Street suffered third biggest daily point drop ever as the Dow Jones Industrial Average plunged by more than 1,000 points with media stocks following the index lower and tech  and social media particularly hard hit.

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Cases of the coronavirus in Italy, the first Western European country with a major outbreak, led to a freakout in global markets as the virus has no vaccine yet and continues to spread. In Italy, six people have died and at least 220 others been infected and authorities shuttered public venues across the country’s north, placing ten towns in quarantine. The cases had surged from three on Friday.

Most are in Lombardy, a region in the north with Milan as the capital. Soccer matches were canceled, schools and universities closed. In Venice, in the northern province of Veneto – the annual Carnival festivities closed down. Production on Paramount’s Mission Impossible: 7 was canceled as the government halted all pubic gatherings.

Stateside, all of the Dow’s gains for the year were erased. Cases outside of China, including South Korea and Iran along with Italy, sparked fear that the illness may become a global pandemic and cripple economic growth. Apple stock plunged by 4.75% to $298.18 as an analyst predicted the company’s supply chains may not be back to normal until June in a worst case scenario, delaying the rollout of highly-anticipated new iPhones with 5G handsets. Apple was among the first to warn of the fallout of the virus on its operations. But the truth is that as the virus spreads, uncertainty is acute and there’s no visibility yet as to a worst case scenario, which is the problem.

Other tech stocks were massacred too, alongside social media. Twitter was down 6.3%, Facebook 4.5%, Google parent Alphabet 4.2% and Amazon 4.1%.

Media and tech entertainment stocks fell across the board from broadcasters to video distributors, programmers and studios. The hardest hit include Dish Network, off 5.8%, AMC Entertainment, down 5.5%, Viacom CBS, off 4.7%, and Disney, which fell 4.3%. Comcast and Sony fell, respectively, 2.7% and 2.5%.

One analyst noted that companies like Netflix and Grubhub could benefit, as people stay put at home more. Netflix stock lost 2.99%.

Overall, the DJIA lost 1,031.40 points, down 3.56%. The Nasdaq fell 355.31 points, or 3.71%, and the S&P 500 dropped 111.86 points or 3.35%. Investors fled stocks into haven like U.S. dollars, gold and Treasuries.

Airlines, cruise lines and other leisure stocks were smashed, led lower by American Air, Delta, Norwegian Cruise, Carnival, Royal Caribbean and Booking.com.

The carnage was clear from early Monday after European stocks suffered their worst day of trading since 2016. The Italian market was the hardest hit with the FTSE MIB Index sinking by more than 5.4%.

Most coronavirus cases (over 77,000) remain concentrated in mainland China, followed by Japan (840) and South Korea (833). The outbreak in Italy in the biggest outside of Asia.

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