Wall Street tumbles as U.S. virus cases pass 100,000

Louis, a NYSE-AMEX floor trader, works in an off-site trading office built when the New York Stock Exchange (NYSE) closed, due to the outbreak of the coronavirus disease (COVID-19), in the Brooklyn borough of New York City, U.S., March 26, 2020. REUTERS/Brendan McDermid

(Reuters) – Wall Street stocks tumbled on Friday, ending a massive three-day surge after doubts about the fate of the U.S. economy resurfaced and the number of coronavirus cases in the country climbed.

U.S. stocks deepened their losses late in the session, even after the House of Representatives approved a $2.2 trillion aid package – the largest in American history – to help people and companies cope with an economic downturn caused by the coronavirus outbreak and provide hospitals with urgently needed medical supplies.

The United States has surpassed China and Italy as the country with the most coronavirus cases. The number of U.S. cases passed 100,000, and the death toll exceeded 1,500.

“We have still not fully understood the degree of the economic impact,” warned Massud Ghaussy, senior analyst at Nasdaq IR Intelligence in New York.

“Currently, from a policymaker’s perspective, it’s a relative balance between managing the spread of the virus and opening the economy.”

After the market closed, President Donald Trump signed the stimulus package into law.

The bill, along with unprecedented policy easing by the Federal Reserve, helped the S&P 500 .SPX surge 10.2% for the week, its best week since 2009. But the U.S. stock market benchmark is still down about 25% from its February high.

In its strongest three-day performance since 1931, the Dow surged 21% in three straight days through Thursday, establishing it in a bull market, according to one widely used definition. Even after Friday’s drop, the Dow ended 12.8% higher, its best week since 1938.

Many investors see a strong risk the market could fall deeply again as coronavirus infections increase and more people die, however.

“Next week will depend on what happens over the weekend,” said Lindsey Bell, chief investment strategist at Ally Invest. “If there is a major acceleration over the weekend of coronavirus cases in New York and other states and the hospital system continues to get jammed up, then I think it will be a rough week for the market.”

Macroeconomic indicators offered a glimpse of the economic devastation from the crisis as the lockdown of major cities upends the lives of millions of Americans.

U.S. consumer sentiment dropped to a near 3-1/2-year low in March, according to a survey released on Friday, a day after data showed a record 3 million surge in jobless claims last week.

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