The New York Stock Exchange fell again on Wednesday. It ended the longest period without a major crisis on Wall Street that had lasted for more than a decade, in a market still plagued by panic against the coronavirus. The Dow Jones collapsed by 5.86% to 23,553.22 points, dropping more than 20% from its last record reached in February.
The flagship Wall Street index has thus entered the bear market, in reference to the bear which symbolizes a depressed market. This had not happened to him since 2009, during the financial crisis. The Dow Jones was notably weighed down by the plunge of Boeing, whose share tumbled more than 18%, while market players were alarmed by the financial health of the American aircraft manufacturer, faced with one of the most serious aviation crises since the September 11 attacks. The highly technological Nasdaq fell by 4.70% to 7,952.05 points, and the broader S&P 500 index by 4.89% to 2,741.38 points.
A “bumpy path”
In the midst of the coronavirus crisis, the New York market was alarmed by the decision of the WHO to qualify Wednesday as “pandemic»Viral pneumonia, which has already infected more than 110,000 people worldwide. According to Maris Ogg, of Tower Bridge Advisors, this indicates “that the worst may still be to come” “It will probably take a few more weeks before we have a clear idea of the scale“Of the epidemic, judges the expert, who recalls that very few tests have been carried out in the United States.
“It will take a while before the market overcomes panic. We are still on a bumpy pathAdds Maris Hogg. To respond to the consequences of the coronavirus, the Trump administration has planned to introduce economic support measures. The President is expected to make a statement on the subject in the evening. Donald Trump notably let float on Tuesday the idea of abolishing social charges and contributions until the end of the year.
Interventions by central banks were also particularly scrutinized by market players, especially after the surprise drop of 50 basis points in its key rates by the Bank of England (BoE). The European Central Bank (ECB) meets Thursday and the Federal Reserve next week, market players expecting a further cut in US rates after the surprise of Tuesday, March 3. The Fed has also announced that it will further increase the amounts it injects into the money market to bring it to at least $ 175 billion daily, starting Thursday.