Trading on America’s Dow Jones stock index has been suspended for the second time in a week after it suffered huge losses in the wake of Donald Trump’s coronavirus address to the nation.
The Dow Jones industrial index of America’s 30 biggest publicly listed companies opened 1,741 points down on Thursday to 21,812 points – a drop equivalent to almost 7.5% of the index’s total value.
It slumped as traders rushed to sell shares over fears prices will plunge further in the coming days. The Dow shed 20% of its value in the last month, with the Dow Jones entering a bear market of slumping share prices and pessimism.
It dropped so rapidly that an automatic ‘circuit breaker’ was deployed for the second time this week. That mechanism automatically halts trading for 15 minutes in a bid to stablize the markets.
America’s larger Standard & Poor’s index of 500 companies lost 6.5% of its value, while the Nasdaq index slumped by 6.55%. Wall Street is experiencing its worst week of trading since the 2008 financial crisis that sparked a global recession.
Financial analyst Greg McBride told ABC News the US would now almost certainly suffer another recession.
He said: ‘The coronavirus pandemic has taken the stock market into bear market territory and further declines are in the offing as the U.S. effectively hits the “Pause” button on the economy in an effort to curtail spread of the virus.
‘Yes, there will be economic disruption and an all-but-certain recession.’
The slump came hours after President Trump’s White House speech which saw him announce a 30 day ban on all travel between the US and Europe, except for flights to and from the UK and Ireland.
President Trump also unveiled a host of emergency economic measures, including plans for a $50billion fund that could be loaned to small businesses to help them through the crisis, which has seen businesses shuttered and people warned to stay indoors.
Trump also vowed to defer taxes in a bid to give businesses and consumers more cash to tide them through the coming months.
Coronavirus has so far infected 1,315 people in the US, and killed 38. Worldwide, the disease has infected more than 125,000 people and killed over 4,600.
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