Wall St. dragged by coronavirus fears, business data

A two-day slump on Wall Street to end the week as investors get early data on how the coronavirus outbreak in China is impacting U.S. companies.

Business activity in the services sector dropped to its lowest in more than 6 years and factory activity posted its lowest reading since August, in a preliminary February survey conducted by IHS Markit.

Looking at the closing numbers: The Nasdaq was hardest hit, percentage wise, tumbling nearly two percent. All the major indices were in the red for the week.

A lot of that money rushing out of stocks went to the perceived safety of U.S. government bonds, which pushed the yield on the 30-year bond to an all-time low and the yield on the 10-year note below 1.5 percent for the first time since September.

But Ken Kamen, president of Mercadien Asset Management, has a warning about dumping money into U.S. government debt.

SOUNDBITE (ENGLISH) KEN KAMEN, PRESIDENT, MERCADIEN ASSET MANAGEMENT, SAYING:

"We're seeing a big flight to quality because at the moment the 30-year is an all-time record low, so if we're in a flight to quality from an event like coronavirus, which we hope is transient, when it goes the other way and investor sentiment changes, if you buy bonds here you're going to be stuck with very low yield or taking a mark-to-market loss when bonds go the other way on you. So I think right here sometimes the best way to double your money is to fold it over once and put in back in your pocket."

Corporate headlines kept investors busy as well:

Sprint and T-Mobile amended the terms of their merger and now expect the deal to close on April 1st. Shares of Sprint closed at a six-year high. T-Mobile finished lower.

And Wells Fargo agreed to a $3 billion settlement with the Justice Department and the Securities and Exchange Commission to resolve long-running criminal and civil probes into fraudulent sales practices. The bank admitted to pressuring employees, which led to the opening of millions of fake accounts.