The coronavirus emergency sent stocks crashing on Thursday to their worst losses since the Black Monday crash of 1987, extending a plunge that has eliminated most of Wall Street’s big gains since Donald Trump’s 2016 election.
The Standard &Poors 500 measure fell 9.5 percent, a drop of 26.7 percent from its all-time high, set one month ago. That left the S&P well past the 20 percent threshold to signify a bear market, ending an unprecedented, decade-long bull market. Likewise, the Dow Jones Industrial Average fell ten percent for its worst day since a historic 23 percent drop on Oct. 19, 1987.
European markets lost 12 percent in one of their worst days ever, despite the European Central Bank’s promise to buy bonds.
The fall came so quickly after the opening bell that it triggered an automatic, 15-minute trading halt for the second time this week. Those “circuit breakers” were adopted after the 1987 crash, and hadn’t been activated since 1997.
The Dow turned upward briefly after the Federal Reserve announced measures to ease “highly unusual disruptions” in the Treasury market. But that respite faded before the market close.
On Wednesday, the Dow finished the day down more than 20 percent from its all-time high, set just last month, officially entering bear market territory for the first time in over a decade.
Both the coronavirus crisis and the chaos on Wall Street spurred fears of recession.
IMAGE: The New York Stock Exchange building is seen from Wall Street in lower Manhattan. REUTERS/Mike Segar