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* Defensive lead losses among sectors
* Mylan slumps after warning of hit to results from outbreak
* U.S. consumer spending slows in Jan
* Indexes down: Dow 4.11%, S&P 3.99%, Nasdaq 3.43%
(Adds comment, details; updates prices)
By Medha Singh
Feb 28 (Reuters) - The Dow Jones Industrials slumped more
than 1,000 points in intraday trading for the third time this
week on Friday, as the rapidly spreading coronavirus outbreak
raised fears of global recession.
Over the week, virus fears have wiped nearly $3 trillion off
the combined market value of S&P 500 companies, putting the
three main indexes on track their worst week since the 2008
global financial crisis.
As the world prepares for a likely pandemic, investors
rushed to safe assets, deepening an inversion of the U.S.
Treasury yield curve, a classic recession signal. US/
The benchmark S&P 500 .SPX fell about 12% from its record
closing high hit last week, confirming its fastest correction in
history on Thursday.
At 10:03 a.m. ET, the Dow Jones Industrial Average .DJI
was down 1,058.08 points, or 4.11%, at 24,708.56, the S&P 500
.SPX was down 118.91 points, or 3.99%, at 2,859.85. The Nasdaq
Composite .IXIC was down 293.97 points, or 3.43%, at 8,272.51.
All the 11 S&P sectors shed at least 2% and the defensive
utilities .SPLRCU , consumer staples .SPLRCS and real estate
.SPLRCR sectors dropped more than 3%. The three sectors have
outperformed the benchmark index this month.
"This selling is a bit extreme for something that we don't
know enough about," said Robert Pavlik, chief investment
strategist at SlateStone Wealth LLC in New York.
"What I do know is that the coronavirus is not going to lead
us into a financial crisis that is long lasting. It could put us
in a technical recession, but the real concern is does that
recession cause the U.S. consumer to pare back on spending?"
While the magnitude of the economic damage from the
containment measures, which have crippled supply chains and hit
business investment, remained unclear, analysts have sharply
downgraded their outlook for growth and corporate earnings.
Adding to worries, the Commerce Department's data on Friday
showed U.S. consumer spending rose less than expected in
January, a loss of momentum that could be exacerbated by the
virus outbreak. Traders are now pricing in an interest rate cut by the
Federal Reserve as soon as next month, but many have expressed
doubts about how this would mitigate the impact of the outbreak.
Among individual stocks, Mylan NV MYL.O dropped 6% after
the drugmaker cautioned a financial hit from the coronavirus
outbreak and warned of drug shortages in case of continued
spread of the virus. Declining issues outnumbered advancers for a 9.24-to-1 ratio
on the NYSE and a 4.63-to-1 ratio on the Nasdaq.
The S&P index recorded no new 52-week highs and 108 new
lows, while the Nasdaq recorded 11 new highs and 386 new lows.