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* Trump's Europe travel curbs slam world markets
* Dow has worst one-day loss since Oct. 1987
* Boeing set for worst week in company history
* Indexes sink: Dow 9.99%, S&P 9.51%, Nasdaq 9.43%
(Updates to market close)
By Stephen Culp
NEW YORK, March 12 (Reuters) - Wall Street tanked on
Thursday, slamming the book on the longest-ever U.S. bull market
after new travel restrictions to curb the coronavirus spread
spooked investors and rattled world markets.
President Donald Trump's Europe travel ban, announced late
Wednesday, sent all three major U.S. stock indexes into a
tailspin, with the S&P 500 and the Nasdaq confirming their first
bear market since the financial crisis.
The blue chip Dow suffered its worst one-day loss since
October 1987's "Black Monday."
The benchmark S&P 500 and the Nasdaq have lost over a
quarter of their value since reaching record closing highs just
16 sessions ago, as nations around the world grapple with how to
contain the fast-moving coronavirus and its economic effects.
A bear market is confirmed when an index sinks 20% or more
below its most recent closing high.
"The continued negative action in the market is telling us
whatever's been done so far hasn't been enough," said Joseph
Sroka, chief investment officer at NovaPoint in Atlanta. "People
can't point to a tangible outcome that's going to restore normal
daily life, so uncertainty remains.
"Prominent organizations, educational institutions and even
sports leagues are foregoing events out of caution," Sroka
added. "Leading institutions around the world are setting the
tone. We're cautious because they're telling us to be cautious."
Trump's sweeping travel restrictions, limiting flights from
continental Europe to the United States, sent European shares
.STOXX to a near four-year low and slammed airline stocks,
already battered by the spread of COVID-19. On Wall Street, airlines .SPCOMAIR plummeted 19.6%.
Boeing Co BA.N fell another 18.1% as J.P.Morgan abandoned
its long-term backing for the company's shares, setting the
planemaker on course for its worst week ever.
The U.S. Federal Reserve is expected to cut interest rates
for the second time this month at the conclusion of its two-day
monetary policy scheduled for next week.
U.S. Treasury yields tumbled as anticipation grew for
aggressive easing on the part of the Fed. The New York Federal Reserve announced on Thursday that it
would introduce $1.5 trillion in new repo operations this week.
"Any government action that has dollars tied to it that's
actionable for the banking system would be viewed as a
positive," Sroka said. "But what the market is looking for is
tangible evidence that the government is trying to stave off a
recession."
Interest rate-sensitive bank shares .SPXBK dropped 10.5%,
while corporate credit worries hit bond fund prices as companies
began to draw on credit lines. The CBOE Volatility index .VIX , a gauge of investor
anxiety, shot up to levels not seen since November 2008, the
height of the financial crisis.
The Trump travel ban also hit oil prices, sending
front-month Brent crude down 8.6%. Oil prices were already under
pressure after Saudi Arabia and Russia vowed to boost
production, flooding the market with supply despite plummeting
demand. The S&P 500 Energy index .SPNY lost 12.3%
The Dow Jones Industrial Average .DJI fell 2,352.6 points,
or 9.99%, to 21,200.62, the S&P 500 .SPX lost 260.74 points,
or 9.51%, to 2,480.64 and the Nasdaq Composite .IXIC dropped
750.25 points, or 9.43%, to 7,201.80.
All 11 major sectors of the S&P 500 closed sharply lower.
Declining issues outnumbered advancing ones on the NYSE by a
23.77-to-1 ratio; on Nasdaq, a 17.69-to-1 ratio favored
decliners.
The S&P 500 posted no new 52-week highs and 336 new lows;
the Nasdaq Composite recorded 3 new highs and 1,573 new lows.
Volume on U.S. exchanges was 18.54 billion shares, compared
with the 12.49 billion average over the last 20 trading days.